Conditions in the farmland market are proving highly variable with some exceptional prices still being paid for land, but average values softening.

Analysis of Strutt & Parker's Farmland Database shows the average price of arable land in the first nine months of the year was £10,400/acre, which is 8% down on the average for the whole of 2024 (£11,300/acre).

The average price of pasture land was £8,500/acre, which is 7% down on 2024 levels (£9,100/acre).

Sam Holt, Head of Estates & Farm Agency for Strutt & Parker, says: "It is proving to be a market of contrasts, with some farms attracting strong competition, while others are finding it hard to find a buyer because of a wide range of variables. Even within the same county, we are seeing land values ranging from £7,000 to £17,000/acre for comparable quality arable land."

The average value of arable land has dropped because of an increase in the amount selling in the £8,000-10,000/acre band and a contraction in the amount selling for more than £12,000/acre.

"Despite this softening, values do remain high by historic standards. If we look back at the five years to 2020, only about 30% of arable land sold each year achieved more than £10,000/acre. In 2025, that figure still remains close to 60%."

Mr Holt says while there remains the perception that a large amount of land has been brought to the open market this year, the data tells a slightly different story.

Around 83,000 acres were publicly launched in the first three quarters of 2025 – slightly ahead of the five-year average, but down just over 10% on the same period in 2024. The number of farms marketed has also fallen from 255 in Q1, Q2 & Q3 2024 to 225 in the equivalent period of 2025.

"Despite surveys showing farmer confidence is low, we have not seen this result in an increase in supply of farms to the market and we anticipate the rest of the year will be quiet in terms of new launches. As is typical in times of uncertainty, many landowners are taking a 'wait and see' approach. We know of several vendors who were preparing to sell this autumn but have delayed until early 2026, preferring to first find out what the Autumn Budget may bring. The Government appears to have a range of revenue-generating ideas on the table but there is no clarity yet on which, if any, will be put forward and people do want more certainty."

The data, which is based on farms and farmland parcels over 100 acres, does point to demand having eased from its 2021/22 peak. A greater proportion of farms launched in 2024 remain unsold or were withdrawn compared with the previous two years and sales are also taking longer.

"However, more than 50% of the farms that do sell are doing so at or above their guide prices," says Mr Holt.

Buyer type doesn't appear to have altered significantly between 2024 and 2025, although the data available is relatively limited at this point. Farmer buyers accounted for over half of transactions in 2024 – which is the first time since 2021 – with early signs of the trend continuing into 2025. Of the non-farmer buyer types, institutional investors have been less active over recent months, likely reflecting weaker commodity prices.

"Despite the challenges facing farmers – which include the changes to inheritance tax rules, a squeeze on arable farm incomes and the closure of the Sustainable Farming Incentive – they continue to be active in the market. Although margins are under pressure, many farming businesses are still prepared to take a long-term view and will pursue opportunities to expand."

Looking ahead, Mr Holt says his message is clear – plan early and seek guidance as soon as possible.

"Success in today's farmland market depends on preparation, flexibility, and an awareness of the wider forces at play. With farms taking longer to sell, lotting has become an increasingly important tool to attract new buyers and generate competition. Setting realistic guide prices and addressing potential obstacles before launch are equally essential. While the market is not straightforward, it can be navigated successfully with the right team of advisors in place."