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Confidence back in the land market but supply tightens

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The survey shows that the average value of farmland rose by rose by 0.2pc in the fourth quarter of 2014, bringing the growth in the year to 3pc

The survey shows that the average value of farmland rose by rose by 0.2pc in the fourth quarter of 2014, bringing the growth in the year to 3pc

The survey shows that the average value of farmland rose by rose by 0.2pc in the fourth quarter of 2014, bringing the growth in the year to 3pc

Doctors differ and patients die, or so the saying goes. Indeed, the same could be said of analysts in the agricultural property market and at this time of the year we are treated to a flood of analyses based on sales in the previous year.

Sherry FitzGerald is among the first out of the blocks and the results of their poring over the entrails of 2014 shows that the price of prime farmland in 2014 rose overall by 2.7pc.

According to their survey, conducted among their branches and agents nationwide, the price of prime arable land increased by 3.6pc, while prime grassland rose by 3.2pc and marginal land by 1.4pc.

These figures are in contrast to an analysis of successful farmland auctions carried out by the Farming Independent, which showed that the price paid at auction for land in 2014 declined by 3.3pc.

The Sherry FitzGerald methodology is based on a quarterly index of price performance in the agricultural land market. The standardised price for each land type is based on the average price for the base period, which for their latest survey was Quarter 4, 2013. David Ashmore of Sherry FitzGerald said the values applied are based on actual sales or likely achievable sales in the given quarter.

Arable

The survey shows that the average value of farmland rose by rose by 0.2pc in the fourth quarter of 2014, bringing the growth in the year to 3pc.

The recently published report indicates that demand is strongest for prime arable land and the best quality grassland. The average price of prime arable land grew by 3.6pc in the 12 months to December, while similarly grassland increased by 3.2pc. Growth in marginal grassland was slower, up 1.4pc in the 12-month period.

The report reveals that confidence has improved but supply levels have significantly tightened.

Up to 98pc of respondents believe that supply has either decreased or remained stable in the quarter.

Looking at regional trends the Sherry FitzGerald report found that the highest growth rate in the final quarter and in the year as a whole happened in the midlands, which grew 1.6pc in the three months to December, bringing growth in the year to 6.5pc.

Farmland values grew consistently throughout 2014 in the southwest and the mid-east regions.

Prices remained stable in Dublin throughout the year, with the capital county recording the highest average farmland value of €12,700/ac.

The report described the border and west regions as the most "challenged" in terms of land values, with a decline of 1.2pc and 0.5pc respectively in the 12 months to December.

Indo Farming