It’s important to note that, despite this moderate price uplift, the average value of farmland remains 2.5pc lower than that witnessed in the opening quarter of 2016, of €9,750 per acre.
A regional breakdown of price performance reveals that the Border and the South-East regions saw the largest rise in agricultural land values in the three months to March.
Following three years where the land markets in the Border counties were quite challenged, this region saw a 1.2pc increase in the average price per acre in Q1 2017, to approximately €9,150.
This was particularly driven by increased demand from both tillage and dairy farmers. The South-East also saw price inflation of 1.1pc, to stand at approximately €10,050 per acre, however, this remains 3.1pc lower on an annual basis.
Such encouraging signs were not witnessed everywhere. The South-West region, in particular, has seen notable fluctuating price trends over the past three years.
Following two years of price inflation in 2014 and 2015, land values stooped significantly in 2016, by 6.2pc. The average price per acre in the South-West has therefore lost any ground gained during this time and is back to levels witnessed at year end 2013, averaging €9,900 per acre.
Large parcels of land in Ireland, of 100+ acres, both including a residence and without, witnessed a moderate rise in average values during the first quarter. However, while large parcels of land without a house were 0.2pc higher in the quarter, they were 1.4pc lower on an annual basis.
This was due to the testing year witnessed during 2016, whereby demand for larger holdings weakened and were therefore more difficult to transact.
A survey carried out amongst over 50 agents nationwide on activity in the agricultural land marketplace reveals that, positively, 25pc of respondents considered activity levels increased during the first quarter of 2017; this compares to 12pc in the same period last year.
Furthermore, buyer sentiment and the supply of land being brought to the market during the quarter also rose moderately.
Overall, the market is rather optimistic for the year ahead. Irish dairy farm incomes are anticipated to recover somewhat, due to a continued strengthening in milk prices, albeit moderately, combined with farm income support from policy developments.
Following the challenges faced at farm level over the past two years, improved profitability of Irish agricultural production will consequently improve the demand for agricultural land.
Commenting on the Border regional market, Brian Carroll, Sherry FitzGerald Carroll, Dundalk, said, “The land market in the Border region has performed better than expected in recent months, with land values steady and even rising in some areas, following a significant increase in supply in the Co. Louth area.
"Unusual for Co. Louth, over 400 acres traded in Q1 2017, with some significant large holdings traded, including a large block of 112 acres just south of Dundalk and 100 acres in Castlebellingham.
"While demand is emanating from all sectors, tillage lands are particularly sought after, not only from local farmers but also Northern Ireland-based operators, who are concerned with the potential Brexit outcome and the pending loss of their European payments. Looking ahead it appears that supply over the next twelve months is going to return to more normalised levels.”
Commenting on the overall market, Roseanne De Vere Hunt, Sherry FitzGerald said, “It is encouraging to see the average land price in the first quarter of 2017 recovering after two years of decline. Together with increased enquiries, milk prices strengthening and buyer sentiment improving, this gives us an optimistic outlook for the year ahead.”