Cereal and dairy farms are still in demand, says Sam Holt
Farms and estates generally continue to hold their appeal, despite the challenges facing agriculture and the wider economy over the past 12 months. Buyers of farmland took a measured approach in 2025, suggests an analysis of Strutt & Parker’s Farmland Database. Updated on a rolling basis using sold prices, it aims to give the most accurate picture of actual market conditions possible.
The database shows the price of arable farmland in England averaged £11,000/acre in 2025, which is 2% lower than in 2024. Pasture averaged £8,600/acre – about 4% down on the previous year.
But both values remain strong by historical standards, says Sam Holt, who leads the land agent’s estates and farm agency. Arable values are 18% higher than five years ago and pasture values 15% higher.
Average values
“Our data – which is based on sold prices for farms or blocks of land bigger than 100 acres – highlights that average values have softened over the past year, but by less than anticipated,” says Mr Holt. “When we ran the figures at the end of September, the drop in values was more significant, but the year ended strongly, which lifted average values.”
Given it is taking longer for farms to sell than it used to – with uncertainty also dampening activity ahead of last Autumn’s Budget – a significant number of deals did not go under offer or exchange until late in the year.
“While average prices remain high, it is important to note there can be a wide variation in the prices paid across both arable and pasture,” says Mr Holt.
Popular areas
“Demand is softer than the 2021/22 peak and so while the best-located farms are still drawing competition and achieving very good prices, other farms and estates are taking longer to find the right buyer. Exceptional prices are still paid for some arable ground. In some instances, we have seen some sizeable blocks of land achieving nearly double the average at over £20,000/acre – and almost 70% of arable land is selling for £10,000/acre or more.”
Some less popular areas have seen prices fall back slightly with sales split into lots to engage the widest possible pool of buyers. Demand is typically strongest for strategic land, cereal and dairy farms, with hill ground slower to sell.
Supply was down on 2024 levels, but at 92,000 acres was 13% ahead of the five-year average, says Mr Holt. But the market appears to be more certain and requests for viewings have picked up since the New Year.
Inheritance tax
The government’s widely-welcomed partial climbdown on inheritance tax – raising the threshold from £1m to £2.5m – could help underpin confidence, alongside lower interest rates, says Mr Holt.
“That said, our experience suggests the IHT reforms have had less immediate impact on transactions than perhaps some had anticipated. Demand from non-farmer buyers has remained relatively stable, while a core of expansion-minded farmers has continued to drive market activity.”
Farmers accounted for more than half of all purchases in England in 2025. But while investor buyers buy fewer farms, they do buy more acres than farmers, as they tend to acquire the larger farms.
Supply was constrained in the second half of 2025, with some vendors not marketing farms until after the Budget. While this may result in an increase in land coming to the market in Spring 2026, Mr Holt doesn’t anticipate a significant surge in supply.
“Our expectation is that the volume of land available will remain consistent with current supply levels. If this is matched by a continued improvement in buyer confidence, it is possible that average values could edge upwards by around 2-3% over the year.”