Land Remains Positive, but Europe Attracts Uncertainty

A land market update from Will Parker of H&H Land and Property.

The north east of England land market continues to remain buoyant with a number of properties coming to the market of varied sizes and uses. Support for purchases remains available through confidence in land as security. However the outcome of the European Referendum in June injects uncertainly in where land and its supply will be in the future.

Will Parker

Will Parker

“We are seeing an interest at all levels of the market”, says Will Parker, Associate Director at the Durham office of H&H Land and Property. “There are cash buyers still interested in acquisition - particularly landowners who are looking to rollover proceeds from the sale of development land.”

The particular demand for small plots in the north east for the equestrian buyer remains strong, with a keen interest in land with stables, and those with planning permission for buildings.

Will adds:
“We are confident that appropriately priced land will sell - that is, as long as the vendors are realistic with regards to the guide price. To find a willing buyer, it is much better start the process with a reasonable asking price. This will attract as many people to the table as possible, and create interest, instead of pricing some out from the start. Active buyers will then drive the price to what the market wants to bear.

H&H Land and Property has a number of quality blocks of bare land and equipped land coming onto the market in May around County Durham, and Will is anticipating them to be sought after by a range of different purchasers, provided the price is right, and matched to the property.

Looking to the future, he is confident in the continued strength of the market, but not necessarily its certain growth. He points to the continuing numbers of buyers looking for good viable farms. “As commodity prices remain on the low side buyers are becoming much more cautious with their money.”

The confidence in the market is currently still supported by the financial system and fortunately there is still a general willingness from the banks to lend on such assets. Will concludes:
“If interest rates stay low and tax efficiency remains in place, there should still be a demand for good land.”

Not all is certain, however, with a wider range of sale prices in the more recent years than before, particularly with upland property with poor access and fewer services. This is an indication of volatility in the market when it comes to competition with other holdings and the general land supply.

Looking into the future is at the moment dominated by the larger unpredictability of the UK referendum on membership of the European Union. Will concludes,
“One question that will remain unanswered is whether the uncertainty of an EU exit and the future of farm support payments will cause the supply of land to dry up once again. On this question, one thing will be certain, and that is that only time will tell.”

HH Land

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