Farm Ireland

Tuesday 25 September 2018

Hobby farmers back in the land game

Grangebeg House on 64ac at Dunlavin Co Wicklow was sold by Jordan Auctioneers for a price in the region of €1.6m
Grangebeg House on 64ac at Dunlavin Co Wicklow was sold by Jordan Auctioneers for a price in the region of €1.6m
Jim O'Brien

Jim O'Brien

In their end-of-year summary of the land market in 2017 Jordan auctioneers report a greater demand for larger holdings and the return of hobby farmers to the market, writes Jim O'Brien.

In a review of sales Paddy Jordan and Clive Kavanagh also reported greater lending by the banks.

"Up to now a lot of holdings had been bought by the remains of development or compulsory purchase monies.

"While lending terms and conditions tend to be strict there has been a freeing up of capital for land purchase by farmers," they said.

In relation to hobby farmers the Newbridge auctioneers say the return of the 'hobby farmer' for smaller holdings is a sign of improvements in the wider economy.

People with an affinity with the land are using surplus cash or borrowing power to buy smaller holdings with a residence and yard.

The hope value for land adjoining towns and villages looks like it could be realised in the near future but Jordans warn farmers that the new Vacant Site Levy coming into force this year will mean a 3pc charge to the owner of development lands in year one rising to 7pc in year two.

The story for marginal land and its prospects are not that bright and the report from Jordans says this is compounded by the weather, "considering the number of bad winters and summers experienced in recent times selling poor or marginal land is very difficult".

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Looking ahead the auctioneers see a continued strong demand for good quality land and plenty of activity.

"Confidence in the dairy sector is high at the present and therefore land close to a number of strong operators is likely to command good interest."

The authors of the report believe investors will continue to see land as a 'safe haven' for money. "Land is a finite resource and unlike other investment products cannot be wiped out by external factors," they said.

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