Factors affecting farmland prices in the Czech Republic

The spatial variability of farmland prices is determined by factors reflecting agricultural use, and also by location-specific characteristics, which are crucial to the conversion of farmland to non-farming uses. In co-operation with experienced real-estate brokers, we collected data from 286 transactions carried out in 2008. We identified factors to be analyzed at the parcel scale and tested their effect on the variability of farmland prices in the Czech Republic using general linear modeling. Our results indicate that the most powerful factor in explaining the sale price per square metre was proximity to a settlement, and significantly higher prices were found close to existing built-up areas. The next most powerful factors were: municipality population, travel time to the capital city, accessibility of the parcel, and natural soil fertility. The results have been interpreted to determine the threshold values for significant factors that support future non-agricultural use of farmland and significantly raise current farmland prices. The values supporting non-agricultural use of farmland are proximity to a settlement (up to 100 m), proximity to a larger municipality (above 5000 inhabitants), short travel time to the capital city (up to 1 h) and accessibility to the parcel via the transportation network.

► In co-operation with experienced real-estate brokers, we collected data from 286 transactions.
► We identified 8 factors to be tested their effects on the variability of farmland prices.
► The most powerful factor was proximity to a settlement.
► The next powerful factors were: municipality population and travel time to the capital city.
► We determine the threshold values that support non-agricultural use of farmland.