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23 de March de 2023
Local Agriculture, Generational Change and Rising Interest Rates to Be Some of the Key Conditioning Factors.
According to our latest Trends report published for 2023, great opportunities are expected to arise for large investors in the acquisition of productive rural properties. The study, carried out by our Research team, analyses the situation of rural properties in Spain and points out that, despite the fact that rising interest rates may lead to reducing the acquisition of agricultural assets by both individuals and small companies, they may also provide an opportunity for large investors interested in purchasing fruit and vegetable farms and having all the assets required for the full agricultural process.
Likewise, the report highlights that the other key factor will be the ageing of farm workers, since more than 30% of farm owners are over 65 and 60% are between 40 and 64. The generational changeover could lead to an increase in sale and purchase transactions involving large farms.
Furthermore, the report also points out that these investments may be favoured due to changes in the population’s lifestyle caused by global political and economic instability, and which require a transformation of the current model. This scenario has produced a cultural transformation towards a closer, seasonal and more environmentally sustainable agriculture. In order to achieve this objective, Gesvalt also warns that the sector will evolve towards a more professionalised model and will be committed to greater investment in technology, which could be boosted by the increased presence of large-scale players in the sector.
2022 has been a challenging year for the rural sector mainly due to significant increases in food prices derived from rising energy prices, which has increased production and distribution costs as well as other expenses also relevant, such as fuel and fertilisers.
Notwithstanding this, in 2023 we expect an increase in cropland price. This prediction takes into account that between 2020 and 2021 land prices in our country rose by €56 per hectare, showing signs of stabilisation after the price fall seen during the previous three years.
In addition, based on the data collected in our Trends report, an increasing demand for land for recreational-residential use can be expected due to the rise of remote working and the population’s lack of interest in urban and overcrowded areas, which may further increase the value of these assets.
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