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Richard Till
Associate Director, Perth Office
The market for established woodland has
witnessed a sustained period of growth over the
past year, not seen for over a decade. Despite
selling agents and valuers revising their
expectations upwards to reflect current demand,
there appears to be no dampening of enthusiasm
from buyers and our most recent sales have
attracted premiums of between 10% to 40% over
asking price. It is frustrating, although not
surprising, that media attention has raised the
profile of woodland ownership benefits at the
very time that shortage of supply is
contributing to the rapidly rising prices.
Expectations that this situation is
unsustainable have so far proved unfounded with
no immediate signs of cooling in the market
place. The temporary lack of all woodland grants
in Scotland and delays over confirmation of the
replacement scheme, not now expected until late
2007, anticipated to depress values of crops
close to harvesting appears to have been more
than compensated for by significant
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improvements in timber prices and the growing
pressure to find mitigation of Inheritance Tax.
At the other end of the spectrum the ‘green
revolution’ is clearly a driving force with
enquiries for smaller and more amenity based
properties at an all time high. Not
surprisingly, Woodland Collective Investment
Schemes have benefited from the current
situation as these investments confer most of
the benefits of woodland ownership whilst
spreading the risks and shifting the pressure to
acquire suitable property to the fund manager.
More than ever good professional advice is
essential in this rapidly changing market as it
is all too easy to overlook some of the
fundamentals in the enthusiasm to outbid the
competition. Existing woodland owners could be
excused a little indulgence in wondering about
their asset valuations and whether now might be
a good time to sell. Please see the capital
values table on the back page for current
average woodland values.
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