Why should you consider land?
The average value for farmland across Great Britain increased by 12.3% during 2005. In 2004 average values increased by almost 16%.
- Savills research, Spring 2006
Savills plc recently reported that Land prices have risen 762% over the last 20 years.
Savills also state that there are strong reasons to own land; these include:
- Development potential - especially where land borders settlements.
- Lifestyle - ownership provides somewhere to live and fulfils an aspiration; 'to own a piece of England'.
- Investment performance - driven by capital growth of farmland and residential property. Quality, location and timing of purchase are important.
- Taxation advantages - land ownership potentially includes Inheritance Tax and Capital Gains Tax relief.
- Income - reasonably secure, steady income for next five to six years from the SPS with the latest environmental iniatives offering the opportunity for additional income.
The advantages of land are:
- Land is real.
- Unlike shares land is tangible - it can be visited, seen and walked on.
- There is a limited supply of land.
- England is a small country with the majority of the population wanting to live in the South East.
- It is easy to understand and seen as a solid investment.
- Land is not open to accounting scandals and it is clear when property prices are going up (or down) and the reason for this movement.
Land increases in value in two ways.
- By increasing property values (due to demand outstripping supply).
- By land gaining permission to have houses built on it.
Spring 2006