Farm Ireland
Independent.ie

Tuesday 25 April 2017

Land leasing rates stay at up to €250/ac as supply collapses

Last year's land leasing prices will be maintained
Last year's land leasing prices will be maintained
Claire Mc Cormack

Claire Mc Cormack

A collapse in the volume of land available for short-term leasing will see last year's price levels maintained, auctioneers have claimed.

Estate agents report strong interest for both grassland and tillage lettings, but they maintain that sufficient land to meet demand will not be available.

Between €150/ac and €250/ac is being quoted for grassland, while tillage ground varies from €150/ac to €230/ac.

Up to 80pc of ground that was traditionally available for con-acre and short-term lettings has been converted into long-term agreements over the last few years, auctioneers estimate.

Roscommon estate agent, John Earley, said he usually had around 150 farms to let at this time of the year but close to 100 of these properties were now tied up in long-term leases.

He said the fact that leases of over five years duration were tax free up to a value of €40,000 was a major attraction for land owners.

While Mr Earley accepted that long-term leases weren't "without their hiccups", he said they generally worked well.

They gave security to both the land owner and the farmer and were a better system overall than short-term leases, the Roscommon auctioneer pointed out.

However, Eddie McQuinn claimed the severe hit milk prices took last year had knocked the gloss off long-term leases for many land owners.

The Tralee-based auctioneer and farm advisor said a lot of tenants reneged on their rents when milk prices tanked last spring and summer, and the attractiveness of long-term leases had taken a battering as a result.

Mr McQuinn said this was the first year that he hadn't any farms to let on his books, despite having plenty of customers for any ground that were to come available.

"I haven't an acre to let - not one," he said. A lot of land that was generally available for letting was now tied up in long-term leases, added Mr McQuinn.

More ground had been planted, he explained, while some land owners who shied away for the five- and seven-year deals were opting to keep the minimum stocking levels on their holdings and harvest the direct payments.

It was a similar story in the southeast, where David Quinn - who is based on Wexford-Wicklow border - was renewing leases at last year's levels.

He said good quality tillage ground with entitlements was making €180-230/ac, while lands without use of entitlements were making €150-170/ac.

Good grazing ground was making €180-250/ac, he said, with heavier ground at €150-180/ac.

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