Analysis of price differences of agricultural land in Northwestern Europe

Abstract

Summary Information about the prices paid for agricultural land has to be obtained from the land-price statistics executed and published by national statistical offices. In these statistics mostly the average price of all areas and average prices of areas with some specific characteristic, e.g., with or without building, are given. These average prices have a large margin, as can be observed from the substantial variance in prices paid for land belonging to the same category of land according to the statistics. For this reason a difference in the published prices between two kinds (categories) of land does not imply a significant distinction between the prices paid for the two kinds of land. For this reason the Statistical Office (Directorate Agriculture) of the European Communities posed the question if, by means of more accurate and relevant definitions of the properties of the objects sold, a more precise statistical information about prices of agricultural land could be obtained. This should be done by executing an enquiry of a sample of transactions of land in which a large number of properties of the object sold and of the parties concerned would be registered. Such studies have been executed in Belgium, the Netherlands and Western Germany, while also a study for these countries together was made. This article is a review and evaluation of the results of the various studies, while also some conclusions about the ‘market’ of agricultural land are drawn, and suggestions for further research are made.