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| Farmland prices in 'record rise' | Farmland prices in 'record rise' |
| (30 minutes later) | |
| The price of farmland has risen at a record rate of 24% during the first half of the year, The Royal Institution of Chartered Surveyors (RICS) said. | |
| The leap in the six months to the end of June was the biggest rise since its survey began in 1995, it said. | The leap in the six months to the end of June was the biggest rise since its survey began in 1995, it said. |
| Farmland now costs £12,965 a hectare on average, which is 47% more than it did a year earlier. | Farmland now costs £12,965 a hectare on average, which is 47% more than it did a year earlier. |
| Julian Sayers, of the RICS, said: "Rising commodity prices have pushed the price of farmland to record highs." | Julian Sayers, of the RICS, said: "Rising commodity prices have pushed the price of farmland to record highs." |
| When broken down into land type, the cost of arable land has increased by 32% during the first half of 2008 to an average of £14,453 a hectare. | When broken down into land type, the cost of arable land has increased by 32% during the first half of 2008 to an average of £14,453 a hectare. |
| Over the same period the cost of pasture land rose less steeply, rising by 16% to £11,477. | Over the same period the cost of pasture land rose less steeply, rising by 16% to £11,477. |
| The credit crunch is putting an end to city expansion into the country Julian SayersRICS | The credit crunch is putting an end to city expansion into the country Julian SayersRICS |
| RICS also said city-based buyers were retreating from the market in the wake of the credit crunch. | RICS also said city-based buyers were retreating from the market in the wake of the credit crunch. |
| Mr Sayers said the rising prices meant farmers and investors were competing for arable land. | Mr Sayers said the rising prices meant farmers and investors were competing for arable land. |
| However, he went on: "The days of the lifestyle buyer are on the wane. | However, he went on: "The days of the lifestyle buyer are on the wane. |
| "The credit crunch is putting an end to city expansion into the country as the precarious financial situation has made city slickers re-think their lifestyle priorities." | "The credit crunch is putting an end to city expansion into the country as the precarious financial situation has made city slickers re-think their lifestyle priorities." |
| Purchases by non-farmers, including lifestyle buyers, have dropped by some 10% during the six-month period to account for just 27% of all land changing hands. | Purchases by non-farmers, including lifestyle buyers, have dropped by some 10% during the six-month period to account for just 27% of all land changing hands. |
| This trend meant farmers and agricultural businesses were again the dominant buying force. | This trend meant farmers and agricultural businesses were again the dominant buying force. |
| Unprofitable farms | Unprofitable farms |
| Meanwhile, the figures also revealed that demand for residential farmland, which includes property, had fallen for the first time in three years during the first half. | Meanwhile, the figures also revealed that demand for residential farmland, which includes property, had fallen for the first time in three years during the first half. |
| And there is an expectation that the growth in the price of all types of farmland will have peaked during the first half of 2008. | And there is an expectation that the growth in the price of all types of farmland will have peaked during the first half of 2008. |
| High commodity prices have led to rises in the cost of farming land, according to the group. | High commodity prices have led to rises in the cost of farming land, according to the group. |
| Factors such as more expensive animal feed and fuel were making some marginal farms unprofitable to run. | Factors such as more expensive animal feed and fuel were making some marginal farms unprofitable to run. |
| As a consequence, surveyors expect a number of small commercial farmers to find they are unable to carry on, leading to an increase in the amount of land on the market. | As a consequence, surveyors expect a number of small commercial farmers to find they are unable to carry on, leading to an increase in the amount of land on the market. |