AGRICULTURAL land and property will continue to be the best performing area of the Shropshire commercial property market in 2012, predicts an agricultural and rural services lawyer.

Douglas Godwin, an associate in the agricultural and rural services team at Shropshire law firm FBC Manby Bowdler LLP says the prices of both farm land and rural properties are set to grow in the coming 12 months and substantially outperform the rest of the market.

“We could see the value of farm land grow by more than five per cent, based on the record values achieved last year, and also see rural homes increase in price,” said Mr Godwin, of FBC Manby Bowdler’s Bridgnorth office.

“Where landowners can achieve a change of use to, say residential use, then of course the value of that land will increase many-fold.”

According to Mr Godwin land prices will continue to be pushed upwards by the appetite of both farmers and investors.

He said: “Farmers are driven by the economic imperative to increase the size of their farms to become ever more efficient. Banks are keen to lend and interest rates remain at an historic low, so now is a good time for them to borrow.

“Investors see agricultural land as both a solid and growing investment, which continues to outperform other asset classes. Overall, agricultural land has increased in value by some 36% in the last five years.”

Smart farmers and estate owners will continue to look to maximise returns from their land and property in 2012, he added, saying: “We are continuing to advise a number of landowners on option agreements, both new and those coming up for renewal, with developers who are keen to secure options on potential building land, and, through our planning team, to advise landowners on any potential for development.

“We have also seen an upturn in the number of sales of barn developments, both potential and completed, in the past 12 months, as people’s desire to live in the countryside remains as strong as ever.

“However, this may change in 2012, as we are already receiving many enquiries from clients about how Shropshire Council’s new community infrastructure levy of up to £80 per square metre on new build schemes and conversions with new build elements will impact on their proposed new rural developments.”