Scottish farmland values rose by 3% on average during the first half of 2012, according to Knight Frank's latest report, and top quality arable land is now worth just over £7,053/acre, with ploughable grassland at £3,600/acre and hill land at £614/acre
James Denne, Head of Farms Sales in Scotland, comments: "People are still positive about farmland, but they are being slightly cautious at the moment. North of the border we tend not to see as much activity from investors as in England. Most of our buyers are farmers and they take a fairly canny view when it comes to buying more land. Anything that is too fully priced runs the risk of attracting limited interest.
'I think if investors were aware of the quality of some of the arable land here and the strong demand to rent or contract extra ground they might be looking further north. Every time I put a farm on the market I always get plenty of phone calls from neighbouring farmers or contractors looking to spread their fixed costs.'
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Farms that are correctly priced are attracting a lot of interest. 'Despite the weather, we had seven viewings the week after we recently launched Upper Huntlywood, a 690-acre Borders arable and stock farm priced at around £4,000/acre for the land,' James adds.
A 316-acre stock farm in Dumfries and Galloway has also just attracted offers over its guide price, despite the continued absence of buyers from both sides of the Irish border who were significant purchasers of farms in the west of Scotland before the credit crunch curtailed their spending power.
Michael Ireland, Head of Rural Valuations in Scotland, who has valued a number of wind farms.
Looking forward, the Knight Frank Scottish Farmland index predicts further growth in values of 3% over the next 12 months. As well as strong demand, a dearth of good farms for sale is likely to support values.
Knight Frank, however, is about to launch a 1,300-acre stock farm in the Tweed Valley, near Melrose, that James says will be a good test of the market.
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