FINANCE: UK Rural property returned 12.3% in 2013, according to the IPD Annual Rural Property Index.
This is an increase on the 9.9% total return achieved in 2012, but below the stellar 15.7% recorded in 2011.
The survey was released in conjunction with Carter Jonas and Smith Gore.
The bulk of the return is driven by values, which rose by 10.7% during 2013.
Rents for agricultural land are typically low, but are should rise, said Gerald Fitzgerald, head of property investment and valuations at Smiths Gore.
He said: “Looking forward, the prospects for the agricultural investment sector remain positive. The recent period of profitability for farming should continue based on the outlook for commodity prices, and helped by the reform of the Common Agricultural Policy that was as benign as it could have been.
“This will support farm rents, which we expect to continue rising in the medium-term, and farmland values which, although at an historic high, are unlikely to stop increasing unless there is a significant change in UK taxation policy, which appears unlikely.”
