Prime London property has rapidly shot up, but farmland has beaten it
We’re used to writing a lot about the rapid growth of London’s property market, so it’s a surprise to hear another property sector has performed even better.
Prime farmland has gone up by 277% in the past 10 years, compared with prime London property up 127%.
In the decade to 2014, prime arable farmland, which is mostly situated in East Anglia, has nearly tripled in value, according to Savills.
The rise in the cost of farmland is partly due to private investors realising they could make hefty returns on their investment – something the prime London property market is already very familiar with.
Buying a farm or some farmland is now a common investment avenue for wealthy individuals. There are massive tax incentives for people to invest in farmland, including agricultural and business relief from inheritance tax.
The recession also drove people to look for new places to store their wealth. Farmland was seen as a safe bet, Andrew Fallows, head of national farms at Carter Jonas, told the FT.
“Agricultural land tends to be counter-cyclical to the rest of economy, so there was a rush to land, which was seen as a haven, in much the same way as gold,” he said.