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Land is a tangible investment. At the time of writing 16 April 2013, gold prices along with many other commodities plummeted overnight. This came out of the blue with no notice whatsoever. Gold investors are no doubt sitting on the edge of their seats waiting for news on the latest value of their investment!

Land is a reliable asset with all sectors multiplying in value over the last 10 years.

When considering the old adage ‘supply and demand ‘alone, consider the fact that as famously stated ‘they are not making any more’! But this is a huge understatement because in reality our country’s land is depleting year on year. For example under the flood plains of East Anglia, under the ever increasing footprint of new housing, commercial buildings, town and city expansions, new railway networks, new highways and by passes, airport extensions, other land progressively crumbles into the sea around some of our coastal regions and other land is steralised under mineral extraction, very little of which gets returned to agriculture.

Land is under pressure to feed our ever increasing nation but now also to support bio mass as an alternative energy fuel. The net result is that there is far more demand for land than availability.

Land values

Why is some land sold at £2,000 per acre and yet some at over £3 million per acre?

The first rule with land prices is that it is only worth what someone will pay for it. Poor quality land that floods occasionally from tidal salt water may be worth £2,000 per acre whereas high value land within a city can be worth £3 million or more per acre providing that it has got planning permission or is likely to get planning permission to suit the developer’s aspirations.

Land with an extra angle such as fishing rights or mooring rights or a spectacular view, can get high premiums. Land suitable for growing coffee, pepper or superior quality wine, sells for huge prices.

Vineyard land generally sells for large premiums if it is able to produce good quality wine. This reflects the uniqueness of the vineyard, the French call this terroir, the planting of the vines which often costs more than the value of the land. The years the vines take to reach maturity and give crop and the post and trellis (guyot) systems. Miniature vineyards or garden vineyards are known as les garagists. Interestingly the world famous champagne Krugg is made from a very small vineyard!

A further consideration is “Future Potential” (if this exists for something more) For example a dwelling or log cabin or even an agricultural dwelling then the value of the land increases. This is often referred to as Hope Value which itself adds considerable value! We are seeing an increase in support from central government for leisure use of land which also includes the green belt. For example looking at the latest government guidance, The National Planning Policy Framework (March 2012) paragraph 3 is headed supporting a prosperous rural economy and states planning policies should support economic growth in rural areas in order to create jobs and prosperity by taking a positive approach to sustainable new developments, to promote a strong rural economy.
Local and neighbourhood plans should:
  • Support the sustainable growth and expansion of all types of businesses and enterprise in rural areas, both through conversion of existing buildings and well designed new buildings
  • Promote the development and diversification of agricultural and other land based rural businesses
  • Support sustainable rural tourism and leisure developments that benefit businesses in rural areas, communities and visitors and which respect the character of the countryside. This should include supporting the provision and expansion of tourist and visitor facilities in appropriate locations where identified needs are not met by existing facilities in rural service centres and
  • Promote the retention and development of local services and community facilities in villages, such as local shops, meeting places, sports venues, cultural buildings, public houses and places of worship. Of particular interest to plot buyers may be the words
  • Support sustainable rural tourism and leisure developments.

Market analysts Savills claim that all sections of agricultural land tripled in value over the 10 years to 2012 and that they predict a 36% increase in value over the 5 years from 2012 to 2017. Interestingly these figures out perform forecasts on other commodities and investments as private and corporate investors search for safe havens for their funds. Over the same period Savills predict residential property rising by 6%. Source Savills.co.uk

The price

When considering the price of a given plot of land we would remind buyers that in addition to the freehold land which they may be acquiring, a vehicular right of way is usually granted which itself occupies land, effectively becoming the property of each and every plot owner, as land over which rights of way have been granted can’t be used for anything else! Certain infrastructure is also often provided for the “benefit of all, “such as a safe access way from the highway , internal network of tracks, mains water provisions, drainage etc, with some land, communal areas are also provided .

Many plots benefit from several years development including tree and hedge planting and maintenance including summer and winter pruning, grass mowing etc. These factors should all be reflected upon when considering land values.

Management Committees

We invite individuals who purchase plots to join a management committee, the purpose of which is to help maintain and maximum plot owners’ enjoyment in their purchase. The committee also acts as a point of contact for any concerns or advice. The management committee may also at its discretion provide and maintain certain facilities such as mains water, communal eco WC, fruit and veg sales, training days, social events, visitor days etc and may also coordinate such things as grape picking and joint wine making where individuals have vines. This is common practice on the continent.