FARMERS accounted for less than half of all farmland purchases in 2018, leading to the interest of lifestyle buyers, investors and high net worth individuals propping up its value.

Strutt & Parker’s head of estate and farm agency Michael Fiddes said that the decline in farmers purchasing farm land was due to farmers finding it more difficult to justify buying land funded by borrowings, and therefore taking a more cautious approach.

But, even without the investment from farmers, the average price of farmland has only fallen slightly below the five-year average, due to the rise in non-farming buyers who are keen to buy land in the right location for reasons which include development potential, privacy, tax reasons, or amenity.

Mr Fiddes said: “The Agriculture Bill, published in September, confirmed the government’s intention to phase out support payments over a seven-year period and much has been made of the negative impact this could have on land prices. History also shows that in times of uncertainty around CAP reform supply of land in the market has tightened.

“However, farm profitability is only one of a number of factors that determine farmland prices, not least because farmers are not the only people who buy land. Our data confirms that over the past two years non-farmers have played an increasing role in the market.

“Bare land in areas where there is little interest from non-farming buyers is where there is greatest downside risk, but it is likely to be a different story for land with strong appeal to non-farmers, or for land with strategic development potential. Overall, we expect that in 2019 and 2020 we could see a decrease in average farmland prices, but that growth will return from 2021 onwards.”