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Thursday 16 August 2018

Milk and mares driving southern land sales boom

A 19th-century residence on 89ac at Johnstown, Co Westmeath was bought at auction by a local dairy farmer for €715,000
A 19th-century residence on 89ac at Johnstown, Co Westmeath was bought at auction by a local dairy farmer for €715,000
Jim O'Brien

Jim O'Brien

The farm property scene in Munster is flying with much of the action happening around Cork and Tipperary.

Many commentators credit the dairy industry and the bloodstock industry with driving the prices in Cork and Tipperary respectively. Indeed, many would 'blame' the industries for driving the prices and putting land purchase beyond the reach of many 'ordinary' farmers in these counties.

A headline sale in the province of a 101ac farm in Douglas within the city boundary is being excluded from these calculations as it has to be regarded as development land given that 5.8m or 58,000/ac was paid at auction for the property

Aside from that, 14 auctions in the province in the first six months of 2018 saw 577ac change hands realising a total of €7,426,800 in revenue and a per acre price of €12,880 marking almost a 26pc increase on the average price paid in the first six months of 2017. The amount of land sold declined 13pc while the revenue generated increased by a whopping 13.4pc.

Landscape Stud on 91ac near the village of Kilsheelan in South Tipperary sold at auction last week making €1.83m surpassing it guide by €480,000.
Landscape Stud on 91ac near the village of Kilsheelan in South Tipperary sold at auction last week making €1.83m surpassing it guide by €480,000.

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The sales were concentrated in Cork and Tipperary and of course the headline transaction was the sale of a 101ac farm at Monees, Douglas in Cork that made €5.8m under the gavel of Michael Barry. Located within the new Cork city boundary, the place was bought in trust by a Galway solicitor. While the residential holding is currently not zoned and farmed for tillage and grass there is a belief that its real value is associated with its location and its development potential.

A 91.6ac Tipperary tillage farm with extensive road frontage on the outskirts of Cahir made a headline price at auction last week. It sold under the hammer for €2.125m making over €23,000/ac.
A 91.6ac Tipperary tillage farm with extensive road frontage on the outskirts of Cahir made a headline price at auction last week. It sold under the hammer for €2.125m making over €23,000/ac.

Among the other headline sales in the province was the auction of a 92ac parcel of tillage ground at Beechmount on the outskirts of Cahir in Co Tipperary. The place made €2.125m or €23,600/ac when it sold under the gavel of John FitzGerald of Dougan FitzGerald in a sale jointly handled by Cashel Marts. While again this piece of land is in itself the best of tillage ground, it did bring a certain amount of 'hope value' given its location on the edge of Cahir.

CCM Property Network saw €19,400/ac paid for a 17ac parcel of grazing ground at Corrin near Conna in Co Cork. While strong prices can be expected for small parcels in strong farming areas, anything over €15,000/ac has to be regarded as exceptional.

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Strong price

Fermoy auctioneer, Michael Barry, saw another strong price paid for a 45.5 parcel of ground at Carrignavar on the northern reaches of Cork city. This farm made €14,945/ac at one of the earliest auctions of the year.

GVM's Tom Crosse agrees that land prices in Munster are up and while he regards auction results as a good indication of the market he says that most land transactions in the Limerick area are happening now by private treaty.

Monard farm in Tipperary made €535,000 surpassing its guide by €85,000 and realising over €11,500/ac.
Monard farm in Tipperary made €535,000 surpassing its guide by €85,000 and realising over €11,500/ac.

"In that regard prices are holding well and we saw an increase of up to 500/ac this year with the average price coming in at €9,500/ac," he said. "The neighbouring dairy farmer is still the best customer."

Michael Barry, who has had a very strong season since the spring, believes the market will be much cooler in the autumn. "After the disastrous winter and the drought of recent months a lot of money has been spent on fodder and feed, this will impact on people's capacity to borrow and repay so I expect the autumn season to be a bit quieter in land sales," he said. "There are a lot of farmers in serious trouble."

An 86ac Tipperary holding with the Galtee mountains to one side and the Comeraghs to the other, sold for €570,000 at auction
An 86ac Tipperary holding with the Galtee mountains to one side and the Comeraghs to the other, sold for €570,000 at auction

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