Cost of agricultural land

Just curious what other think so I created this poll. Thanks for participating.

 

It depends very much on whether there is 'clean title' and road frontage or right of way access

 

check, check, check. We bought the land to have those three.

 

The problem with prices in the Philippines is they seem to be "slightly" inflated from what I have seen. Thanks for the data point.

 

I would say the real issue is pretty simple.

Theoretically farmland should be priced such that if a farmer buys it to farm on they can expect to make a decent income plus enough money to pay off the loan to finance the land.
So if we assume for a moment that a bank can be found willing to take a 30 year mortgage of 5 million on the land at a 7% interest rate (just an example, am sure no bank can be found willing to do that) then the farmer would need to make 35,000 a month on top of his reasonable income of let's say 15,000 a month, so 50k in total, or 600,000 a year.
Needless to say there are zero farmers in the Philippines who make 600k a year, unless it's a major landowner owning several dozen hectares and employing a bunch of farmhands.
Moreover, 3,000 sqm is hardly a farm worth calling that, basically only suited for subsistence or hobby farming.

Thus, almost all farmland offered for sale is aimed not at potential buyers wanting to farm, but at people looking for a nice big lot to build a house.
The only reason that works is that proper zoning laws (meaning no building permits would be given for farmland other than to establish a barn/shed or similar) are unheard of here (or not enforced), resulting in ever increasing residential areas outside the cities proper and simultaneously shrinking agricultural land.

 

Thanks to those who took the time to vote.

 

In the UK - probably elsewhere also - farmland has rocketed in price for many years. This was supported by subsidies and other freebies they gave to landowners (who, coincidentally, includes the royals and many MPs) but as these are withdrawn due to Brexit, there seems no downward pressure. The relatively small amount of land on the now-overcrowded UK is a factor plus the ever-increasing wealthy buy farms as a status symbol.

 

As far as I know it is fairly easy to have agricultural land changed to residential status? our Lot there is around 1.2klm from the centre on Valencia not so long ago this was all Agricultural land, at around the same time as we bought ours which had residential status by this time and was bought from another Foreigner, a near neighbour another Foreigner bought Agri land and had been sitting on it for a while leaving as was and paying the lower rate of land Tax, however he paid the going rate for residential Land for that particular area, so I would guess land in a premium location close to the centre of the Town has much the same value whether or not it is Resi or Agri?

I paid P1M for 600M2, I was telling the Locals that the value of their land will rise rise considerably when people hear that the first Scotsman has moved in to the area, some time after this, a Lot behind me of 450M2 was up for sale at P3M then another one of the same dimensions was priced at P4M, of course non of them will sell at this price, with their true value at around P0.9M, In my time there I have known of many examples of Lots and Houses for sale at double their true value mostly by Filipino owners, there was a 3bed 2bath Bungalow on a lot of around 500M2 up for sale recently, this being in Valencia, this was priced at P10.5M which to me is about double the actual value, this was Built by English Dave who claims to be a builder/tradesman back in UK? his build methods using skinny pillars are not fit for purpose in my opinion? however someone just may pay this crazy price considering it must be well built done by a Builder for his own personal use he did live in it for a couple of years?

It turned out I was not the first Scotsman to buy land in Valencia as another sneaked in there before me, he lives up there in the Mountains much like the place he hails from Aberdeen, they are the real Teuchters (a kind of US Hillbilly) from up there, there they speak the Doric a nonsense language that no one understands in fact they do not even communicate with each other all that well, yes they are a queer like breed from up them there hills?

 

There's an empty lot near me if you decide to move. lol