Farm prices hit new high

The price of an acre in the West Midlands hit £7,625 according to the Royal Institute of Chartered Surveyors. The rise was fuelled by increased demand and a shortage of availability, with commercial farmers looking to expand.

Many are aiming to capitalise on high commodity prices.

This means they are looking for large, good quality plots near their own holdings, with as small a residential space as possible.

But, because of this, smaller plots with lower soil quality are dropping in price.

Charles Cowap, of Shropshire's Harper Adams University, who is the RICS rural spokesman, said: "Commercial farmers were willing to pay for good sized blocks of better quality land."

NFU spokesman Oliver Cartwright said: "Farmland prices have soared in the last decade. However, this will be of little consequence to many farmers unless they are looking to sell up, buy extra land or if they are new entrants trying to get on the farming ladder.

"Land price is an issue but does not necessarily mean a closed door for a new entrant looking to get into the industry. A lot of weight is attached to what land is worth but for farmers it is what is being produced on that land and the price being paid for produce that is of real importance."

The land price increase could yet continue – the figures showed that 40 per cent of respondents have seen a fall in the supply of commercial farmland, potentially pushing prices yet higher.

Philip Meade, of Davis Meade Property Consultants in Shropshire, said a lot of demand was being driven by uncertainty over future of payments made to farmers through the European Common Agricultural Policy.

He said: "It is thought the new direct payments will be based on the land occupied at some future date. The effect of this is that farmers are reluctant to sell, surrender or rent land out in case they miss out."