Agricultural soil market : Agricultural soil markets in regions with strong settlement development

Background (completed research project)

The progressive conversion of agricultural areas into settlement and transport zones affects mainly those soils that were previously covered by agricultural land rights legislation. The agricultural land market is of central importance in that agricultural land rights impact on the efficiency of spatial planning processes. One key prerequisite for coordinated land use policy is therefore an agricultural land market that functions in line with market-economy rules. If this is not the case, decision-making processes regarding land use changes and the provision of compensatory areas operate on the principle of least resistance, which can contradict the top-level objective of a sustainable soil use.

Aim

The aim of the study is to link agricultural land market policy with issues of soil use and the repurposing of agricultural areas. This aspect is key in the implementation of spatial planning tools intended to promote the sustainable use of soil as a resource, and it increases the scope for action in spatial planning because it provides points of reference for the improved coordination of land-use legislation (Federal Act on Rural Land Rights (RLRA), Federal Act on the Leasing of Agricultural Land (LALA), and Spatial Planning Act (SPA)).

Results

Contrary to expectations, it appears that the agricultural land markets in the three cantons of Aargau, Zurich and Graubünden tend to function relatively well. Agricultural land transactions are taking place regularly almost everywhere and follow similar patterns. Overall, these transactions are largely independent of general economic factors such as a buoyant regional construction market or a high proportion of residential areas. The relevant influences are in fact more of an agricultural nature, such as a marked change in agricultural structure or a high intensity of land use. Thus, the agricultural land market seems increasingly to be becoming an internal agricultural matter, which is what the legislator was aiming for with the RLRA in 1991.

Land-use schemes that affect the availability of agricultural areas (e.g. rezoning) are either no longer taking place or are being planned at a long run (e.g. major infrastructure projects, draining of wetlands or renaturation of water courses). The agricultural land market is therefore scarcely affected, and no (transaction) blockades are to be anticipated. However, this in itself does not ensure that soil as a resource will be used sustainably. It is more a case that the resulting changes in land use are the result of procedural and engineering plans or processes and that the plots are “coincidentally” available for land compensation purposes.

Implications for research

Involving key enforcement players and practitioners in this study made it possible to ascertain that disagreements as to the borders between "settlement" and "non-settlement" zones – notably also within the agricultural zone – have not hitherto been addressed in a coordinated and constructive dialogue. In research, therefore, there is a need first of all to obtain a better understanding of the actual problems and secondly to identify the most efficient way of tackling these problems.

Implication for practice

Despite the general observation that agricultural land markets are operating fluidly – and even though the correlations appear to be weak – certain cases were noted in which the functioning of agricultural land markets in municipalities with high commercial potential was to some extent impaired. This observation is important and – given the backdrop of newly established production infrastructures and the conversion of former agricultural buildings – suggests an unwelcome development. Possible ways of avoiding undesirable developments are being intensively discussed, but have not yet been fully thought through. One possible approach might be the more systematic management of planning permits for “building outside construction zones”; moreover, the demolition obligation enshrined in spatial planning law (SPA Article 16b) should be borne mind.

According to the experts involved in the study, sustainable land use can be achieved via comprehensive strategies for possible spatial developments that are drawn up in participative processes involving all those concerned – including the farming community in particular. A basis is essentially provided by the structural planning procedure (e.g. at the “prior information” stage). Procedures for drawing up comprehensive strategies and providing the necessary foundations for structural planning are currently being developed (e.g. agricultural planning).

Original title

Agricultural land markets in regions with strong residential and commercial development: reasons, challenges and political options

Principal investigator

• Gianluca Giuliani, Flury & Giuliani GmbH
• Christian Flury, Flury & Giuliani GmbH