FARMLAND VALUES in Pembrokeshire are rising at four times the rate of inflation because of a shortage of farms on the property market.

Estate agents are reporting a mini land price boom with average values topping £6,000 a hectare.

At the beginning of the year, land was being snapped up at £5,390 a hectare. Prices have since risen by 12% and are currently averaging £6,010.

Demand is not limited to the so-called lifestyle farmers. Optimism is returning to the milk production sector and foot-and-mouth restrictions are not deterring potential buyers.

This summer, two farms in neighbouring Carmarthenshire have been sold to farmers in restricted areas, even though they are as yet unable to relocate their livestock.

James Andrews, a partner with West Wales chartered surveyors, Llewellyn Humphrys and Co, has inquiries daily from potential buyers.

For anyone who is retiring or leaving the industry for whatever reason, it is a good time to sell," he said.

The market in the west is very buoyant at present, due to the lack of property for sale and significant demand from South-East Wales and England."

Llewellyn Humphrys currently has no commercial farms on its sales books. The last holding it sold was the 190-acre East Hook Farm, near Haverfordwest, which last month exceeded its £400,000 asking price.

At the smaller end of the market, Waun Uchaf, Newport - an improvable cottage with 13 acres of land and outbuildings - sold last week for £172,000 at an auction held by J. J. Morris, estate agents, Cardigan.

The only farm of significant size currently on the market in Pembrokeshire is Warren Farm, near Castlemartin.