LONDON Feb 28 Britain's farmland prices hit a
record high in the second half of 2013 on the back of strong
commodity prices and as a rebounding housing market pushed up
demand for homes in the countryside, a survey showed on Friday.
Floods which swept parts of southern England in January may
have damaged some of the land available, further hurting supply
as farmers seek to expand their businesses, the Royal
Institution of Chartered Surveyors (RICS) said.
The average cost of farmland jumped 14.3 percent from the
same period in 2012 to 7,754 pounds ($12,900) per acre across
England and Wales - a record for the ninth consecutive period,
according to the survey.
While the rise was largely commercially driven, residential
demand also picked up in the last six months of 2013 for the
first time in over three years.
Britain's housing market has seen a fast rebound, prompting
the Bank of England in November to say it would remove mortgage
lending incentives from the Funding for Lending Scheme it
launched in August 2012 to encourage banks to lend to households
However, the market is still supported by record-low
interest rates and another government scheme to aid home-buyers.
Britain's Co-operative Group said on Wednesday it
was selling its farming business in a bid to revitalise its
operations - a move which could help bring more farmland onto a
"Farmland price growth has been enormous in recent years,"
said Jeremy Blackburn, RICS head of UK policy.
"With commodity prices now having remained strong for some
time, many farmers have been looking to expand their businesses
and, with so little actually coming up for sale, competition for
good land is fierce."