Tuesday 27 September 2016

East-south land price divide widens

Leinster sales booming but dairy slump hits Munster values

Jim O'Brien

Published 06/01/2016 | 02:30

The biggest holding sold at auction in 2015; the 404ac Little Budds farm at Dysart on the shores of Lough Ennel in Westmeath. It sold at auction in March for €1.95m
The biggest holding sold at auction in 2015; the 404ac Little Budds farm at Dysart on the shores of Lough Ennel in Westmeath. It sold at auction in March for €1.95m

Farmers paid an average of just over €10,000/ac for land bought at auction last year, with the slump in dairy incomes hitting sales in the southern counties.

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Overall land prices were virtually unchanged in 2015 compared to the previous year despite a massive increase in the area of ground sold.

The average price paid for farmland over the past 12 months was €10,152/ac. This was up just 0.2pc on the 2014 average of €10,135/ac.

Last year's slump in dairy returns had a major impact on the market in Munster, where the average sale price for farmland fell by 25pc to €9,057/ac.

However, auctioneers say they are getting prices of up to €15,000/ac in private treaty sales for land in Cork.

The comprehensive survey by the Farming Independent of 200 published sales found that 10,791ac of ground sold under the hammer and netted €110m. In contrast, the area sold in 2014 was 7,679ac, and the revenue generated stood at €78m.

Expensive

South Leinster continues to be the most expensive region in which to buy land. In the counties of Kildare, Laois, Carlow, Kilkenny, Wicklow and Wexford the average price paid last year was €12,083/ac, up 8.4pc on the 2014.

This is almost double the average for Connacht/Ulster and over 19pc ahead of the national figure.

Land sales in the area increased by 44pc, with over €47m spent in the auction rooms, an increase of 57pc on the amount spent the previous year.

The strongest performing region last year was North Leinster.

The area of land sold at auction there soubled compared to 2014, while the revenue generated increased by 110pc.

The average price increased by a modest 6.4pc, rising from €9,493/ac to €10,098/ac.

In contrast, the land market in Munster was significantly slower, as falling incomes saw dairy farmers slam the brakes on expansion.

A fall in milk incomes and a greater uptake of long-term land leasing rather than purchase was reflected in a massive €2,281/ac drop in the average sale price in the southern province.

The average price dropped by a whopping 25pc from €11,338/ac in 2014 to €9,057/ac in 2015.

The total amount spent on land in the province decreased by over 6pc to €21m.

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