Page last updated at 18:09 GMT, Friday, 18 April 2008 19:09 UK

The gold rush for UK farmland

By Jeremy Cooke
Rural affairs correspondent, BBC News

A sheep
The demand for agricultural farmland is very strong

Mark Twain once wrote: "Buy land. They're not making it any more."

More than a hundred years later, in rural Britain, there are plenty of potential buyers anxious to take his advice.

In fact the demand for land is now so strong that it is driving the value of agricultural farmland to record highs.

One of the reasons is supply and demand.

The National Farmers Union estimates that less than 100,000 acres of British farmland comes on the market each year, a tiny fraction of the area of the country which is agricultural.

And now - with the price of global commodities like wheat rising dramatically - there is more money to be made from farming than in there has been for many years.

It all means that Manor Farm at Middle Stoney in Oxfordshire is attracting plenty of people ready to splash out.

Of course the period farmhouse and buildings are a big part of the draw.

But increasingly it is the 420 acres of farmland which is interesting investors of all types.

Alex James
Musician Alex James moved his family to an Oxfordshire farm

Graham Candy of land agents Carter Jonas told me: "We've got a lot of local family farmers interested in bidding for this farm… also City individuals earning bonuses still are looking for lifestyle purchases and moving over here into Oxfordshire.

"And the Irish and the Danes are also looking. So we've got a very wide audience who are bidding for Manor Farm."

Mr Candy says that the increase in the value of land has been dramatic.

He has seen land which was valued at just £3,500 an acre just a few years ago is now fetching £6-8,000 an acre.

In some parts of the country it is beginning to feel like you need Rock star money to join the great British land grab.

Alex James, the bass player in Britpop group Blur, moved his young family to an Oxfordshire farm a few years ago.

For him it was a lifestyle decision and he's fully bought into the rural life.

But Alex sees other reasons for a new wave of investors keen to buy their own slice of Rural Britain.

Safe investment?

"Land is free of inheritance tax so wealthy people are buying land because basically they can transfer their assets to their beneficiary tax free. It's kind of like getting a lump sum when you die," he said.

But, as he surveys his own fields full of Ewes and their new lambs, he is clearly not too impressed with developments.

"It's not really what you want. You want people to buy land because they want to do something with it and use it. But it's all being packaged up and turned into tax-free death benefits."

Land has always been regarded as a steady, safe, long term investment.

Now that is all changing as investors predict that - even as house prices fall - the value of land will continue its spectacular rise.

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