Scotland’s rural land market has entered a markedly slower phase following the rapid growth and speculative activity seen in the years immediately after the pandemic, according to a new report from the Scottish Land Commission.
The Rural Land Market Insights Report 2026, produced in partnership with SRUC, suggests that the heightened activity of recent years has given way to a more cautious and selective market across farmland, forestry, estates and natural capital.
Based on interviews with land agents operating across Scotland, the report found that activity levels declined across most sectors during 2025, with fewer active buyers, longer transaction times and reduced competition.
One land agent described conditions as ‘probably the slowest I can remember since around the crash in 2008’, while another said ‘the market just seems to have frozen’.
However, the report suggests the slowdown reflects a broader shift in investor behaviour rather than a collapse in demand.
Agents reported that speculative investment has reduced significantly, with buyers now seeking clearer evidence of long-term returns before committing to deals.
The forestry and natural capital sectors experienced the sharpest cooling during 2025, with demand for planting land and carbon-focused projects falling significantly compared to the peak years between 2020 and 2022.
One agent said: “People were just willing to take the risk. And they’re now not.”
Another commented: “Transactions are scarce relative to recent years but are now constrained more by demand than supply.”
The report highlights a range of factors influencing the market, including high interest rates, inflation, taxation uncertainty and wider economic pressures. Within forestry, low timber prices and delays in planting approvals were also identified as major concerns impacting investor confidence.
By contrast, the farmland sector was found to be comparatively resilient, supported by demand from expanding farming businesses and stronger livestock prices.
Policy and practice lead at the Scottish Land Commission, James MacKessack-Leitch said the report highlighted a notable change in sentiment among buyers.
“Over the last few years we’ve seen significant changes in Scotland’s rural land market, particularly around forestry and natural capital investment,” he said.
“What’s interesting in this year’s report is the sense that buyers are becoming more cautious and more selective about where they invest – if at all.
“It’s important that we continue building a clear picture of what’s happening across the market, because these trends have real implications for rural communities, land use and the wider rural economy.”
Dr Ian Merrell of SRUC, who authored the report, said the market appeared to be moving into a different phase from the highly active post-pandemic period.
“This year’s findings suggest the market is entering a different phase from the highly active period seen during and immediately after the pandemic,” he said.
“Across multiple sectors, buyers are taking more time, scrutinising opportunities more carefully and placing greater emphasis on evidence of long-term viability and returns.
“At the same time, farmland has remained relatively resilient compared to forestry and natural capital markets.”
The report also noted that Scotland’s rural land market remains relatively small overall, with previous Scottish Land Commission analysis finding land sales in 2024 accounted for around 0.5% of Scotland’s total land mass.
Responding to the findings, Scottish Land & Estates said the latest report reinforced the view that the exceptionally high land values recorded between 2020 and 2022 were an anomaly driven by unusual market conditions.
Director of policy at Scottish Land & Estates, Stephen Young said the surge in natural capital interest and the impact of the Covid pandemic had temporarily broadened the range of buyers entering the market.
“What is increasingly clear is that the very high land values seen between 2020 and 2022 were an outlier,” he said.
“We urged caution at the time about drawing sweeping conclusions from a limited and unusual period in the market. However, the Scottish Land Commission used those findings to argue for further legislative intervention, and we have since seen the passage of a new Land Reform Act alongside a series of wider government interventions.”
Mr Young warned that reduced investor confidence could have wider economic consequences for rural Scotland and for the delivery of environmental targets.
“In 2024/25, Scotland created 8470 hectares of new forest and woodland - almost 10,000 hectares below the target set under the Climate Change Plan for that year,” he said.
“Reductions in public funding for woodland creation played a role, but so too has the policy environment created by both the Scottish and UK governments, which has made private investment in Scotland’s land less attractive.”
He added that uncertainty surrounding the new Land Reform Act, including proposals around enforced lotting and prior notification requirements, risked undermining Scotland’s attractiveness to investors.
“One positive aspect of the report is the continuing steady activity in farmland sales,” he said.
“However, the UK Government’s punitive APR and BPR proposals have changed the outlook for many family farming businesses.
“Scotland needs a land market that is transparent, trusted and capable of attracting responsible long-term investment. That will not be achieved by treating investment as a problem to be managed, but by creating a policy environment that gives rural businesses the confidence to deliver.”
