Farm Ireland
Independent.ie

Tuesday 24 October 2017

Slide in land prices halted but market remains under pressure

Farmland values settle although auction results back €380/ac on average since 2009

A 46pc recovery in farmer incomes through 2010 helped to keep a floor on land prices through the first half of the year, but continuing difficulties in sourcing finance for farm purchases has undermined the market
A 46pc recovery in farmer incomes through 2010 helped to keep a floor on land prices through the first half of the year, but continuing difficulties in sourcing finance for farm purchases has undermined the market
A price in excess of €733,000 was paid in October for a 94ac residential holding at Lionsden, Longwood, Co Meath

Declan O’Brien

The four-year slide in land prices has slowed dramatically, with average farm sale values for 2010 holding close to 2009 levels.

The average price paid for farm land this year fell by just €380/ac compared to 2009.

Relative to 2008, the drop in land values was €2,080/ac.

Survey results appear to confirm that the sharp fall in agricultural land prices, which has seen values halve over the past four years, has finally started to ease.

Agricultural ground sold for an average of €8,420/ac over the past 12 months. This compares to an average auction price of €8,800/ac for 2009 and €10,500/ac for 2008.

The prices included in the survey are for all auction results published in the Farming Independent and the Farmers Journal from January 1, 2009 to December 18 last.

Exceeded

The survey comprised 116 sales, with the total area sold extending to 8,445ac. The value of the land sold at auction exceeded €70.1m, which is considerably higher than the €55m realised from auction sales in 2009.

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Overall, land prices in Leinster have fallen sharply over the past two years. In 2008 the average sale price for agricultural farmland in the province -- excluding the commuter belt counties of Meath, Kildare and Wicklow -- was €14,255/ac.

However, auction prices in the province this year averaged just €9,400/ac, even with sales from the commuter belt counties included. This represents a drop in value of 35pc in 24 months.

The country was broken into six geographic districts for the purposes of the survey.

These included Munster, Connacht and Donegal, Cavan and Monaghan, North Leinster, South Leinster and Dublin.

The highest price paid for farmland this year was Dublin, where the average sale value stood at €14,767/ac. Just four properties sold under the hammer in the county but a number of farms did come on the market this year.

South Leinster took second spot in land value league, with farms in the region averaging €9,627/ac. This district comprised Wexford, Wicklow, Laois, Kilkenny, Kildare and Carlow.

Farm sales in Wexford and Kildare made up the bulk of the results. More than 1,000ac were sold in Kildare, with prices averaging €13,390/ac. In contrast, the average sale price in Laois was €8,257/ac.

The average price paid for farmland in North Leinster was €8,923/ac. This district included Meath, Louth, Longford, Offaly and Westmeath.

Farm auctions in Meath accounted for almost half of the acreage sold across the five counties in the north of the province. The 800ac sold under the hammer in the Royal County averaged €9,900/ac.

Land values across Munster followed the national trend, with sale prices down on last year -- albeit not as dramatically as in some quarters.

In 2009 the average price of agricultural land in the southern province was €9,977/ac. But this figure was back 15pc in 2010 to €8,494/ac.

Few farms went under the hammer in the west. The average price for Connacht and Donegal was €7,036/ac which is well back on the €10,053/ac average for 2009. However, just 192ac went under the hammer in the west this year, with many of the farms being withdrawn and sold later.

The total area sold in Cavan/Monaghan was 114ac, with land in the northern counties averaging €9,605/ac. But, once again, the sample size for the counties was small as just four farm sales were included.

Indo Farming