27 May 2015, Agricultural land enjoyed another buoyant year in 2014, recording a total return of 11.8%. The figures quoted include transactions and developments which have increased the total overall return this year.
The asset class’s performance continues to be driven by strong capital growth, of 10.3%, with income return remaining stable at 1.4%, in line with its 2013 level.
Inevitably, regional variations were evident in the latest figures released, with the South East, Eastern and Yorkshire & Humberside regions all out-performing the UK average and recording strong total return performance figures of 18.0%, 14.5% and 13.3% respectively.
The longer-term performance of agricultural land clearly highlights the resilience of the sector through the turmoil of the global recession. This is in sharp contrast to all of the other mainstream property asset classes and reinforces the “safe haven” status of land. The graph below illustrates the continuing double digit performance across all time frames measured within the Index
Andrew Fallow, Partner and Head of Rural Agency at Carter Jonas comments “2014 proved to be another year of impressive performance for agricultural land. Double digit capital growth of 10.3% was recorded, in line with both 2012 and 2013. This reflects an impressive and sustainable level of growth which we forecast will continue into 2015 with demand for land showing no sign of abating”.
You can download the IPD UK Annual Rural Property Index by clicking here