Will Brexit Affect the Value of Your Farmland?
Fears have been expressed by some land agents that agricultural land prices may fall in the UK, as a direct result of Brexit.
It is expected that the amount of subsidies, such as the Basic Payment Scheme, will decline once Britain leaves the EU, causing some farmers to re-consider their financial position. Many are already struggling to make ends meet and a reduction in subsidy support, combined with a predicted interest-rate rise for borrowing, may result in many being forced to leave the industry.
As a consequence the demand for farmland could fall away, with the price per hectare dropping by as much as £1,000, despite it having remained fairly robust so far, at an average of around £7,500 for bare land.
However, even the experts admit it is difficult to predict the full impact of Brexit, with so many other factors coming into play, such as trade tariffs, pricing and food imports. Post-referendum predictions of economic doom and gloom have not yet come to pass, so those in the industry would be wise not to panic at this stage.
Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.