Price growth of Scottish farmland set to continue

Price increases have historically tended to lag slightly behind the English farmland market, but there is now very little difference in performance
 
This trend was not lost on investors, said James Denne, who heads up Knight Frank’s Scottish Farm Sales’ team. "I have just sold a large block of good arable land to an investment fund. The price was slightly lower than they would probably have had to pay south of the border, but the prospects for capital growth are just as good."
 
Investors are also attracted to farmland because it is more tangible and less volatile than some other investments, particularly during times of economic uncertainty, said Andrew Shirley, Head of Rural Research.
 
"If a company you have invested in fails, the value of your shares could be worthless. Farmland will always retain its underlying worth and will continue to provide a rental income. It is also unlikely to experience the short-term peaks and troughs that affect equity markets."
 
Farmland also compares favourably to other "safe-haven" investments like cash deposits and government bonds, said Shirley.

"Your capital may be extremely safe in the bank, but the returns can be so low that after taking into account inflation the value of your asset is actually eroding."

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