“If you don’t pay EUR4,000 you won’t be able to buy a single hectare in a good area,” explains Erik Jantzen, owner of Jantzen Development, which operates on the farmland market in Romania.
Agricultural land has become an investment that investors started seriously considering after 2009, once the traditional real estate market plunged. Those that sensed the trend a decade ago were the real winners considering such assets have risen in value by 40% on average ever year.
The farmland market has not reached its peak so further price increases are expected in the coming years, the British company says.
Other economies to see the highest growth rates besides Romania were Hungary, Brazil and Mozambique, according to the report.
Romania’s farmland market was liberalized for EU individual investors this year, and therefore the government passed a law on farmland transactions giving buying priority to local communities.
Romania has 13.7 million hectares of agricultural land, 8.5 million hectares of which arable land. Foreign investors either own or rent via long-term contracts about 1 million hectares or 12% of the total.
(English version by Loredana Fratila-Cristescu)