British farmland prices have tripled in the last decade and are set to rise further, according to a report in the U.K. Farmers Weekly.
Quoting the RICS rural land market survey, it says that during the first six months of this year, farmland prices jumped to £7,440/acre (C$12,180) across the U.K.
In 2004 land prices were just over £2,400/acre (C$3,929).
RICS said the growth in prices was largely being driven by commercial farmers seeking to expand their operations, although investors were also seeing land as an economic safe haven.
Farmer buyers were said to favour large, top-quality neighbouring plots with as small a residential component as possible.
Plots that were smaller and of lower soil quality were attracting much less interest and receiving lower prices.
“The growth in farmland prices in recent times has been nothing short of staggering. In less than 10 years we’ve seen the cost of an acre of farmland grow to such an extent that investors — not just farmers — are entering the market,” said RICS spokesman Sue Steer.
“If the relatively tight supply and high demand continues, we could experience the cost per acre going through the £10,000 (C$16,370) barrier in the next two to three years.”