French land price falls for the first time in 20 years

The average price of land in France in 2017 was almost €6.000 per hectare. This means that the price of land has fallen by about 0,8% compared to the previous year. It is the first time in more than 20 years that the price has fallen.

The decrease not only goes against the French trend of price increases, but also against the European trendline† The decrease is explained by the low income of arable farmers; the half wheat harvest in 2016 is mainly to blame for this. Livestock farming also had less milk income, but was able to compensate for this by more favorable feed prices. 

However, prices vary greatly from region to region. With regard to land prices, France can be divided into 3 regions. The first region is the north; from Normandy to Belgium, which also includes Picardy. Land prices are highest here and do not fall below €7.000 per hectare. In Nord-Pas-de-Calais you pay about €1 for 13.000 hectare.

Central France
The second area is Central France, which stretches from Brittany to Lorraine and from Gironde to Savoy. Land prices here are lower than in the north and average around €6.000 per hectare. In the third area, the south, prices are again higher. In the departments bordering the Mediterranean Sea, between €8.000 and €17.000 per hectare is paid

Despite the slight decline, the price of agricultural land in the country is still high (compared to previous years). If we compare the land price with 10 years ago, we see that it was € 4.700 per hectare at the time.

Foreign investment
Although there are many rumors that foreign investors unwelcome on the French land market, and that even President Macron has spoken out about this, only 2017 purchases were made by foreigners in 107. The total value of this amounted to €122 million. However, France is not in a position to ban foreign investors from the land market, as Macron is in favor of further integration of the European Union.

Leo Dorresteijn, broker at Van der Slikke Rentmeesters: "The real problem when buying land in France is the French banks. They are very hesitant and cautious when it comes to financing foreign farmers. The French banks are once again extremely cautious, with regard to the situation in Italy, because France is a major investor in Italy."

A way can still be found through Dutch investors to purchase land in France. They then lease the land to Dutch tenants. However, they are also very careful (according to Dorresteijn).

Anne-Jan Doorn

Anne Jan Doorn is an arable expert at Boerenbusiness. He writes about the various arable farming markets and also focuses on the land and energy market.

aj.doorn@boerenbusiness. Nl

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