Causes and impacts of developments on agricultural land markets

Background and Objective

The agricultural land market is the subject of public debate in Germany. Land prices have risen substantially. Farmers are increasingly competing with each other for the diminishing amount of land, which is reflected in rising rental prices. Agricultural land is continually being lost through converting it for other uses. At the same time, farmland has become an attractive investment opportunity for investors from outside agriculture.

With the Real Property Transactions Act and the Agricultural Land Lease Transactions Act, state instruments exist to intervene in the land market to protect the agricultural structure. Are these instruments effective enough? What can be done to increase their effectiveness? We develop knowledge about the land market developments and their effects in order to be able to assess governmental regulatory instruments.

Approach

We are an advisory member of the Federal States’ Initiative on land market policy. We support this working group by conducting analyses and written statements.

We evaluate existing statistics and scientific literature, take part in conferences and actively participate in scientific discussions. Findings from other, externally funded research projects are also incorporated.

Recently, three studies have been published on the relevance of non-agricultural and supra-regional investors on the East-German farmland market. The current focus is on the ownership structures of agricultural land in all German federal states. Using the example of the federal state of Bavaria, we have also examined options for legal design and administrative implementation in agricultural land market policy.

Data and Methods

Statistical data is not very meaningful for assessing land markets, which are often differentiated on a small scale. Depending on the research question, we analyse data provided to us by state or federal administrations or generate quantitative data with the help of internet research, surveys, expert interviews, or case studies at a small-scale level.

Preliminary Results

The results of our research are published in scientific articles and working reports (see list of publications below).