THE COST of farmland in Wales grew more than any other part of the UK over the past year, new figures say.

According to the latest RICS/RAU Rural Land Market Survey, land prices in the UK are now 8.4 per cent higher than a year ago, after it rose by four per cent in the first half of 2014 to at £8,607 an acre.

The increase means farmland costs more than four times what it did when RICS first began recording rural land market data in 1994 (when land cost £2,028 per acre).

It said price growth in the last decade has been driven principally by farmers.

The breakdown showed Wales saw the largest price increase over the last 12 months (19 per cent), where the average price per acre now stands at £8,625 – higher than anywhere else across the UK – and nearly seven per cent above the national average.

While interest from potential buyers has now seen substantial rises since the end of 2008, the imbalance between supply and demand appears to show no sign of waning.

In the face of growing concerns around housing shortages and burgeoning populations, investors are increasingly seeing land as an economic safe haven, RICS said.

Over the last 12 months, 32 per cent more chartered surveyors reported rises, rather than falls, in demand and looking ahead to the next 12 months, 44 per cent of respondents expect prices to rise, rather than fall.

Ed Meyer, a RICS Wales rural spokesman, said: “I anticipate more land coming to the market and an increased uptake by the ‘lifestyle buyer’ looking for a little slice of rural idyll, whether this will inflate the prices further or whether the projected interest rate rise will cap the increase remains to be seen.”