The average price of agricultural land in Ireland in 2018 was €9,072/ac, the Irish Farmers Journal survey can reveal. This is an unusually small 0.18% drop from the average price in 2017, which was calculated at €9,088/ac.
Since 2012, the year-on-year changes in the average price have ranged from 2% to almost 10%. Never in the last 12 years has the average price remained virtually the same for two consecutive years.
Disparity
On a county-by-county basis, of course, there is a major disparity in prices. Dublin saw the highest price in Ireland, at almost €22,000/ac, followed by Kildare, Louth, and Kilkenny. Leitrim once again had the lowest county average at €5,220/ac, though prices did rise by almost 14%.
Mayo, Roscommon, and Clare were also among the bottom four on price.
Values dropped in 14 counties, with 12 seeing their average price rise. Dublin (75%), Kilkenny (29%) and Waterford (23%) had the greatest price jumps.
Major speculator interest in the Dublin market contributed to the exceptional price there. In Kilkenny, the presence of strong dairy, tillage and beef farmers in the market drove prices up to just under €12,500/ac.
The stunning 204 acres at Moorepark Farm in Garristown, Co Dublin, sold under the hammer at auction for €2,000,000 or almost €10,000/ac to a tillage and beef farmer
Wicklow and Offaly saw the greatest average price fall last year. Wicklow’s price dropped almost 25% to just over €9,000/ac, while in Offaly prices dropped almost 20% to just under €8,000/ac.
Laois saw a 10% price reduction, predominantly as a result of the county’s exceptional performance in 2017. Average values also fell in Meath, Mayo and Monaghan.
In areas dominated by dairy, the market was livelier. North Cork, south Tipperary, parts of Carlow, north Wexford, parts of Kildare, and Dublin saw the most vibrant land market in 2018.
In saying that, however, there were micro-economies in suckler-dominated areas that performed well.
Parts of Roscommon had a very active land market with activity from farmers from neighbouring counties increasing competition.
A region in north Mayo had a number of strong buyers and higher prices were seen there in 2018. Forestry has also kept a price floor in these areas, especially for marginal ground.
Inconsistent
The best single word to describe the Irish land market in 2018 was inconsistent. Depending on what land agent you speak with, there is a different perspective. Many factors affect the land market in Ireland, and it is difficult, therefore, for one general statement to sum up the market situation.
Factors such as location, access to finance, expectations and land quality, to name but a few, all play their part in the sale of land. These variables then give rise to the inconsistencies in the responses from land agents.
Possibly the most important factor is interest, and local interest at that. Without an individual being interested in a farm, the chances of it being sold are significantly reduced.
On the flip side, where two or more local farmers get involved, some strong prices can be seen. A private treaty sale in north Connacht during the year ended up making almost €20,000/ac, for the simple reason that two neighbouring sheep farmers wanted the land. A similar parcel 2km down the road attracted no interest and failed to sell.
On the occasions when the variables work in the property’s favour, extraordinary sales can be seen and there were many such sales last year.
The sale of Bengurragh House in Cahir on 101ac for €2.83m, or over €25,000/ac, to Coolmore was a major result this year, albeit that the presence of a number of houses brought the final price up. A 72ac residential farm sold in Danesfort, Co Kilkenny, for €1.75m or €24,300/ac while, also in Cahir, a 92.5ac farm sold for a substantial €2.175m or €23,500/ac. In each case, the competition was strong and the quality of land high.
Numerous other sales caught the eye. The stunning 204ac at Moorepark Farm in Garristown, Co Dublin, sold under the hammer at auction for €2m or almost €10,000/ac to a tillage and beef farmer.
The 91ac farm in Clarkeville, near Edenderry in Offaly, sold for €1,150,000, or over €12,600/ac, to a dairy farmer.
Supply
The estimated supply of land to the market in 2018 was 70,246ac, an 11% decrease or more than 8,100ac on the 2017 figure. In total, 18 counties had reduced land supply last year, with only eight counties offering more land than the year previous. There was little in the way of consistency when it came to supply.
In terms of acres sold, this was also lower by 6.4%, or almost 2,200ac. Dublin, Kilkenny and Waterford saw the highest increases in acres sold, with Donegal, Offaly, and Kerry showing the greatest reduction.
Weather
One quote which stuck out during the auctioneer feedback was made by an agent from Cork, who said: “In 2018 we were drowned out of it, frozen out of it and burned out of it.”
It is hard to argue.
The difficult weather conditions at the back end of 2017 continued into 2018 as a wet and cold spring held back land coming to the market.
Late March to April is usually when we see the trickle of land coming for sale. However, last year this was reduced by the poor weather.
As agents delayed putting properties to the market until the weather improved and the land would look better, a surge of land came for sale in May.
While the wet and cold spring had a big impact on the distribution of supply, the summer drought had more of an impact on demand as land became a secondary priority, especially in dairy-dominated areas.
Sentiment
One aspect of the report that is unquantifiable but very important is that of sentiment, and 2018 did not provide many farmers with much positivity.
A struggling beef sector was noted by most auctioneers as the main reason for a reduction in enquiries and demand, certainly in parts of the midlands and west.
While the wet and cold spring had a big impact on the distribution of supply, the summer drought had more of an impact on demand as land became a secondary priority
The aforementioned dry summer saw a reduced demand from farmers in general as the drought had a heavy impact on the mood. Negative sentiment dominated beef and suckler areas as the land market struggled in respect to demand, enquiries and finished sales.
Brexit
If Brexit had little or no effect on the land market in 2017, this changed last year. A vast number of agents attributed the upcoming UK withdrawal date from the EU as an inhibitor in the market.
Certainly, in predominantly beef and suckler areas, demand and enquiries seemed to fall off slightly. While poor beef prices contributed, the uncertainty that Brexit created made some farmers uneasy about investing in land.
It must be noted that while Brexit had an impact on sentiment, it is not the sole reason certain land parcels did not sell. On page 36, we outline reasons why some land parcels fail to generate interest or find new buyers.
Leasing demand
In a market that is characterised by inconsistency, the only consistent trend is that demand for leasing land continues to grow. The lucrative tax-free income earned from leasing land is encouraging vendors to rent their holdings.
There is no question that this is reducing the supply of land for sale across Ireland and has been since the option was made more attractive in 2016.
From a financial point of view, leasing has become a more practical and cheaper alternative for farmers to access land.
As finance becomes trickier to access, especially for beef farmers, and with many expanding dairy farmers counting the costs of infrastructural developments on their farms, many are seeing leasing as the best option for expansion.
This has led to a demand for leasing ground reaching an all-time high. Areas with a number of strong dairy farmers are seeing grassland prices reach well over the €200/ac mark, with the once-unthinkable €300/ac becoming more frequent.
Supply of leasing land is now also scarce. Most leases are renewals as farmers try to keep a tight grip on what they have. Agents have also noted that conacre, or 11-month rents, are becoming fewer.
Who is buying land?
Business people are active in the land market and the competition for land has risen due to their presence.
Over 17% of land parcels sold in 2018 were bought by those with business interests and the average prices showed the lengths to which those with business interests were willing to go.
The average price paid by business people was just over €12,000/ac. According to our data set, they purchased almost 8,000 acres last year.
In Douglas in Cork, it is understood that a company from the west of Ireland bought a 101-acre farm for €5.8m or €58,000/ac. A 180-acre land bank sold in Lucan in Dublin for a sum believed to be €9m or €50,000/ac to a business buyer.
Understandably, Dublin saw the heaviest business presence in the land market, with speculators contributing considerably to Dublin’s exceptional €21,983/ac in 2018. In total, three farms sold for over €50,000/ac in the county.
As speculator interest is a factor in the land market here, these figures cannot be ignored. The commuter belt around Dublin is also seeing significant business activity. Over 42% of land sales in Louth, almost 29% in Meath and 24% in Kildare were purchased by business people.
Dairy
High input costs across the spring and summer were certainly noted by agents but, while it was a difficult year for some, the dairy farmer was the strongest of the farming sector by quite some way when it comes to land purchases.
Dairy farmers make up around 14% of the total number of farmers in Ireland, but they accounted for almost 23% of all purchases, according to our study. There are 18,000 dairy farmers in Ireland, compared with more than 80,000 beef farmers.
With beef farmers accounting for 33% of land sales, in relative terms, the number of dairy farmers purchasing land compared to beef shows the financial disparity and spending power between the two sectors.
The average price paid by dairy farmers in Ireland in 2018 was €9,700/ac. In areas where the dairy presence was higher, some exceptionally strong prices were paid.
Cork, Carlow, and Donegal had the highest proportion of land sales attributed to dairy buyers, with 50% of land transactions completed by that enterprise in these counties.
Mayo, Leitrim and Offaly had the lowest proportion of land sales attributed to dairy farmers. However, it must be noted that almost 30% of Offaly transactions were completed by mixed farmers, most of whom were dairy and beef farmers.
Strong competition between bigger beef farmers and dairy farmers contributed to the major increase in land prices in Kilkenny.
Beef
Sentiment around beef farming was mainly negative last year. Consistently auctioneers noted the poor prices and little return were reducing the appetite for land among the largest cohort of farmers in Ireland.
The high average age of beef farmers was also cited by agents as a restriction to buying land. The lack of younger farmers in certain areas contributed to the lack of demand and level of enquiries.
However, beef farmers did account for the highest number of land purchases by enterprise. Over 33% of land sales nationally were attributed to them. This excludes the number of mixed farmers involved in beef, which made up 6.6% of sales in 2018.
The vast majority of these beef farmers purchasing land, however, would be part-time and relying on off-farm income to supplement the cost of the land.
The high average age of beef farmers was cited by agents as a restriction to buying land
Predominately suckler and beef counties continued to see the lowest prices in Ireland. Our records show that over 40% of land sold in Leitrim, Mayo, Clare, Cavan, Galway, Longford and Roscommon were bought by beef farmers.
In each case, the average price in these counties was under €7,000/ac, with Mayo and Leitrim both under €6,000/ac.
Roscommon had the highest beef purchase activity in Ireland, with almost 55% of land sales, with Galway, Monaghan and Leitrim just behind.
Monaghan and Laois were the only counties that had predominantly beef buyers where prices were over €7,000/ac. The averages were brought up here due to strong results by dairy farmers in parts of the counties.
Tillage
Tillage farmers made up 2.5% of all land purchases in Ireland and the average price paid for land was over €11,500/ac. What is noticeable is the pressure tillage farmers are coming under from the dairy sector.
Tillage farmers are restricted by land quality and, more often than not, are located in strong dairy areas. For these reasons, the expansion of dairy farmers has meant many tillage farmers have no choice but to compete with stronger prices.
Louth, Wexford, and Carlow have the highest proportion of tillage-only buyers, followed by Meath. It must be noted, however, that most mixed farmers who purchased land in Kilkenny, Laois, Carlow, Kildare, and Wexford had tillage enterprises.
Forestry
The lucrative tax-free premiums for planted land are continuing to attract forestry buyers, both nationally and internationally. The changes to the Grant and Premium Scheme in 2014 continues to re-invigorate the market for forestry land, with individuals or companies who plant land receiving tax-free income on clearfell timber, as well as annual premiums, which increased between 2% and 7% in 2018.
Since 2015, the market for forestry land has become more competitive with some counties, particularly in the west of Ireland, noting a greater percentage of sales to forestry companies.
For this reason, the price paid for forestry land is also increasing. International investment funds, predominantly from Scandinavia, mainland Europe and London, continue to be active in the market.
However, the domestic market is also quite strong. The demand for forestry as an investment remains high.
The average price of forestry land in Ireland in 2018 was just over €4,900/ac, but typical values ranged from between €3,500/ac and €5,500/ac.
The average of just under €5,000/ac was brought up by a number of mature plantations that were bought by forestry companies.
Leitrim had the highest percentage of forestry sales in 2018. Almost 20% of all land transactions in the county were bought for forestry. Almost 15% of sales in Mayo were attributed to forestry, with Sligo (10.3%), Roscommon (10%) and Galway (7.7%) following suit.
Forestry continues to be a contentious issue, especially in Leitrim. However, there is anecdotal evidence to suggest that the volume of forestry sales in Leitrim eased over the latter months of 2018.
Public campaigns such as Save Leitrim have increased the number of appeals against plantations being sent to the Department of Agriculture, Food and the Marine’s Forest Service. While the appeals themselves may not be successful, a number of companies have reduced their activities in the county and are looking elsewhere.
As a result, we are more likely to see increased activity in various other counties where the average price is lower.
For every action, however, there is a reaction. In last year’s report, the observation was made that there was a vibrant interest coming from Cavan, Leitrim and Sligo for land in Roscommon. The rationale behind this was that land was being planted in the buyer’s home county and the premiums were being used to buy land in surrounding counties. This trend continued in 2018.
The re-emergence of international buyers became obvious around the country towards the end of 2018.
After the UK’s Brexit referendum in June 2016, buyers from the UK decreased significantly and Ireland’s country-home market felt the impact of this response. This trend continued in 2017 and into the first six months of 2018.
However, late last year, as the Brexit withdrawal date loomed closer, a noticeable switch in the trend occurred.
An increase in international buyers, particularly from the UK, began to re-enter the market in what auctioneers noted as a bid to invest money in the euro.
This wasn’t just the UK buyer. Agents nationwide noted parties from all over Europe, as well as America, were active in the country-home market. The property of choice for these buyers was a good-quality residential holding on 10ac to 30ac.
The price point of €850,000 to €900,000 seems to be the most popular among international buyers. A number of agents said that a residential holding in Ireland is a desirable purchase for international buyers. The lower stamp duty levels in Ireland have also facilitated international buyers.
The domestic market for country homes remains strong, especially around the Dublin commuter belt.
The market for larger, more expensive estates is much more specialised and it is therefore trickier to find a buyer, though a number were sold last year
Numerous residential properties on 20ac to 40ac in Kildare, Meath and Laois made substantial sums over the course of 2018.
The market for larger, more expensive estates is much more specialised and it is therefore trickier to find a buyer, though a number were sold last year. Castletown Cox on 513ac was sale agreed back in April for a sum believed to be around €20m, while Lisselan Estate on 315 acres in Co Cork was bought by Colette Twomey, owner of Clonakilty Black Pudding, for about €3m.
There are certain international factors also affecting this part of the market.
The influence of Chinese buyers reduced over the course of 2018 due to softening of Chinese interests in the western economies. It is believed a large estate in the midlands was in the process of being sold to a Chinese investor, only for the deal to fall through during the year.
The auction room
The number of public auctions increased by 34% last year across the country, with almost 550 property up for auction. The success rate at auction also grew.
Last year saw almost 51% properties offered for sale at public auctions sell under the hammer, up from 47% in 2016.
Meath had the most active auction room in 2018, with 47, followed by Kildare on 46, Roscommon on 39 and Tipperary with 35.
Wicklow and Wexford saw the highest number of properties offered at auctions sell under the hammer and they had the most successful rates of sale, with 74% and 66% of properties selling under the hammer respectively.
Just under 33% of farms offered to the market last year were by public auction. While this method makes up just one-third of farms offered, for numerous auctioneers it is the preferred method of sale.
Agents have noted the frustration that certain private treaty sales can bring. The advantage of a successful public auction is once the hammer falls, the deal is complete. The sentiment towards certain private treaty sales is they can drag out.
The outlook for 2019 will be interesting and how Brexit plays out will have a bearing on the market. Supply is back already this year as vendors have been encouraged to sit tight until Britain’s withdrawal date of 29 March has passed.
Predicting the future of the market is difficult when there are too many unknowns at this point.
The average price of agricultural land in Ireland in 2018 was €9,072/ac, the Irish Farmers Journal survey can reveal. This is an unusually small 0.18% drop from the average price in 2017, which was calculated at €9,088/ac.
Since 2012, the year-on-year changes in the average price have ranged from 2% to almost 10%. Never in the last 12 years has the average price remained virtually the same for two consecutive years.
Disparity
On a county-by-county basis, of course, there is a major disparity in prices. Dublin saw the highest price in Ireland, at almost €22,000/ac, followed by Kildare, Louth, and Kilkenny. Leitrim once again had the lowest county average at €5,220/ac, though prices did rise by almost 14%.
Mayo, Roscommon, and Clare were also among the bottom four on price.
Values dropped in 14 counties, with 12 seeing their average price rise. Dublin (75%), Kilkenny (29%) and Waterford (23%) had the greatest price jumps.
Major speculator interest in the Dublin market contributed to the exceptional price there. In Kilkenny, the presence of strong dairy, tillage and beef farmers in the market drove prices up to just under €12,500/ac.
The stunning 204 acres at Moorepark Farm in Garristown, Co Dublin, sold under the hammer at auction for €2,000,000 or almost €10,000/ac to a tillage and beef farmer
Wicklow and Offaly saw the greatest average price fall last year. Wicklow’s price dropped almost 25% to just over €9,000/ac, while in Offaly prices dropped almost 20% to just under €8,000/ac.
Laois saw a 10% price reduction, predominantly as a result of the county’s exceptional performance in 2017. Average values also fell in Meath, Mayo and Monaghan.
In areas dominated by dairy, the market was livelier. North Cork, south Tipperary, parts of Carlow, north Wexford, parts of Kildare, and Dublin saw the most vibrant land market in 2018.
In saying that, however, there were micro-economies in suckler-dominated areas that performed well.
Parts of Roscommon had a very active land market with activity from farmers from neighbouring counties increasing competition.
A region in north Mayo had a number of strong buyers and higher prices were seen there in 2018. Forestry has also kept a price floor in these areas, especially for marginal ground.
Inconsistent
The best single word to describe the Irish land market in 2018 was inconsistent. Depending on what land agent you speak with, there is a different perspective. Many factors affect the land market in Ireland, and it is difficult, therefore, for one general statement to sum up the market situation.
Factors such as location, access to finance, expectations and land quality, to name but a few, all play their part in the sale of land. These variables then give rise to the inconsistencies in the responses from land agents.
Possibly the most important factor is interest, and local interest at that. Without an individual being interested in a farm, the chances of it being sold are significantly reduced.
On the flip side, where two or more local farmers get involved, some strong prices can be seen. A private treaty sale in north Connacht during the year ended up making almost €20,000/ac, for the simple reason that two neighbouring sheep farmers wanted the land. A similar parcel 2km down the road attracted no interest and failed to sell.
On the occasions when the variables work in the property’s favour, extraordinary sales can be seen and there were many such sales last year.
The sale of Bengurragh House in Cahir on 101ac for €2.83m, or over €25,000/ac, to Coolmore was a major result this year, albeit that the presence of a number of houses brought the final price up. A 72ac residential farm sold in Danesfort, Co Kilkenny, for €1.75m or €24,300/ac while, also in Cahir, a 92.5ac farm sold for a substantial €2.175m or €23,500/ac. In each case, the competition was strong and the quality of land high.
Numerous other sales caught the eye. The stunning 204ac at Moorepark Farm in Garristown, Co Dublin, sold under the hammer at auction for €2m or almost €10,000/ac to a tillage and beef farmer.
The 91ac farm in Clarkeville, near Edenderry in Offaly, sold for €1,150,000, or over €12,600/ac, to a dairy farmer.
Supply
The estimated supply of land to the market in 2018 was 70,246ac, an 11% decrease or more than 8,100ac on the 2017 figure. In total, 18 counties had reduced land supply last year, with only eight counties offering more land than the year previous. There was little in the way of consistency when it came to supply.
In terms of acres sold, this was also lower by 6.4%, or almost 2,200ac. Dublin, Kilkenny and Waterford saw the highest increases in acres sold, with Donegal, Offaly, and Kerry showing the greatest reduction.
Weather
One quote which stuck out during the auctioneer feedback was made by an agent from Cork, who said: “In 2018 we were drowned out of it, frozen out of it and burned out of it.”
It is hard to argue.
The difficult weather conditions at the back end of 2017 continued into 2018 as a wet and cold spring held back land coming to the market.
Late March to April is usually when we see the trickle of land coming for sale. However, last year this was reduced by the poor weather.
As agents delayed putting properties to the market until the weather improved and the land would look better, a surge of land came for sale in May.
While the wet and cold spring had a big impact on the distribution of supply, the summer drought had more of an impact on demand as land became a secondary priority, especially in dairy-dominated areas.
Sentiment
One aspect of the report that is unquantifiable but very important is that of sentiment, and 2018 did not provide many farmers with much positivity.
A struggling beef sector was noted by most auctioneers as the main reason for a reduction in enquiries and demand, certainly in parts of the midlands and west.
While the wet and cold spring had a big impact on the distribution of supply, the summer drought had more of an impact on demand as land became a secondary priority
The aforementioned dry summer saw a reduced demand from farmers in general as the drought had a heavy impact on the mood. Negative sentiment dominated beef and suckler areas as the land market struggled in respect to demand, enquiries and finished sales.
Brexit
If Brexit had little or no effect on the land market in 2017, this changed last year. A vast number of agents attributed the upcoming UK withdrawal date from the EU as an inhibitor in the market.
Certainly, in predominantly beef and suckler areas, demand and enquiries seemed to fall off slightly. While poor beef prices contributed, the uncertainty that Brexit created made some farmers uneasy about investing in land.
It must be noted that while Brexit had an impact on sentiment, it is not the sole reason certain land parcels did not sell. On page 36, we outline reasons why some land parcels fail to generate interest or find new buyers.
Leasing demand
In a market that is characterised by inconsistency, the only consistent trend is that demand for leasing land continues to grow. The lucrative tax-free income earned from leasing land is encouraging vendors to rent their holdings.
There is no question that this is reducing the supply of land for sale across Ireland and has been since the option was made more attractive in 2016.
From a financial point of view, leasing has become a more practical and cheaper alternative for farmers to access land.
As finance becomes trickier to access, especially for beef farmers, and with many expanding dairy farmers counting the costs of infrastructural developments on their farms, many are seeing leasing as the best option for expansion.
This has led to a demand for leasing ground reaching an all-time high. Areas with a number of strong dairy farmers are seeing grassland prices reach well over the €200/ac mark, with the once-unthinkable €300/ac becoming more frequent.
Supply of leasing land is now also scarce. Most leases are renewals as farmers try to keep a tight grip on what they have. Agents have also noted that conacre, or 11-month rents, are becoming fewer.
Who is buying land?
Business people are active in the land market and the competition for land has risen due to their presence.
Over 17% of land parcels sold in 2018 were bought by those with business interests and the average prices showed the lengths to which those with business interests were willing to go.
The average price paid by business people was just over €12,000/ac. According to our data set, they purchased almost 8,000 acres last year.
In Douglas in Cork, it is understood that a company from the west of Ireland bought a 101-acre farm for €5.8m or €58,000/ac. A 180-acre land bank sold in Lucan in Dublin for a sum believed to be €9m or €50,000/ac to a business buyer.
Understandably, Dublin saw the heaviest business presence in the land market, with speculators contributing considerably to Dublin’s exceptional €21,983/ac in 2018. In total, three farms sold for over €50,000/ac in the county.
As speculator interest is a factor in the land market here, these figures cannot be ignored. The commuter belt around Dublin is also seeing significant business activity. Over 42% of land sales in Louth, almost 29% in Meath and 24% in Kildare were purchased by business people.
Dairy
High input costs across the spring and summer were certainly noted by agents but, while it was a difficult year for some, the dairy farmer was the strongest of the farming sector by quite some way when it comes to land purchases.
Dairy farmers make up around 14% of the total number of farmers in Ireland, but they accounted for almost 23% of all purchases, according to our study. There are 18,000 dairy farmers in Ireland, compared with more than 80,000 beef farmers.
With beef farmers accounting for 33% of land sales, in relative terms, the number of dairy farmers purchasing land compared to beef shows the financial disparity and spending power between the two sectors.
The average price paid by dairy farmers in Ireland in 2018 was €9,700/ac. In areas where the dairy presence was higher, some exceptionally strong prices were paid.
Cork, Carlow, and Donegal had the highest proportion of land sales attributed to dairy buyers, with 50% of land transactions completed by that enterprise in these counties.
Mayo, Leitrim and Offaly had the lowest proportion of land sales attributed to dairy farmers. However, it must be noted that almost 30% of Offaly transactions were completed by mixed farmers, most of whom were dairy and beef farmers.
Strong competition between bigger beef farmers and dairy farmers contributed to the major increase in land prices in Kilkenny.
Beef
Sentiment around beef farming was mainly negative last year. Consistently auctioneers noted the poor prices and little return were reducing the appetite for land among the largest cohort of farmers in Ireland.
The high average age of beef farmers was also cited by agents as a restriction to buying land. The lack of younger farmers in certain areas contributed to the lack of demand and level of enquiries.
However, beef farmers did account for the highest number of land purchases by enterprise. Over 33% of land sales nationally were attributed to them. This excludes the number of mixed farmers involved in beef, which made up 6.6% of sales in 2018.
The vast majority of these beef farmers purchasing land, however, would be part-time and relying on off-farm income to supplement the cost of the land.
The high average age of beef farmers was cited by agents as a restriction to buying land
Predominately suckler and beef counties continued to see the lowest prices in Ireland. Our records show that over 40% of land sold in Leitrim, Mayo, Clare, Cavan, Galway, Longford and Roscommon were bought by beef farmers.
In each case, the average price in these counties was under €7,000/ac, with Mayo and Leitrim both under €6,000/ac.
Roscommon had the highest beef purchase activity in Ireland, with almost 55% of land sales, with Galway, Monaghan and Leitrim just behind.
Monaghan and Laois were the only counties that had predominantly beef buyers where prices were over €7,000/ac. The averages were brought up here due to strong results by dairy farmers in parts of the counties.
Tillage
Tillage farmers made up 2.5% of all land purchases in Ireland and the average price paid for land was over €11,500/ac. What is noticeable is the pressure tillage farmers are coming under from the dairy sector.
Tillage farmers are restricted by land quality and, more often than not, are located in strong dairy areas. For these reasons, the expansion of dairy farmers has meant many tillage farmers have no choice but to compete with stronger prices.
Louth, Wexford, and Carlow have the highest proportion of tillage-only buyers, followed by Meath. It must be noted, however, that most mixed farmers who purchased land in Kilkenny, Laois, Carlow, Kildare, and Wexford had tillage enterprises.
Forestry
The lucrative tax-free premiums for planted land are continuing to attract forestry buyers, both nationally and internationally. The changes to the Grant and Premium Scheme in 2014 continues to re-invigorate the market for forestry land, with individuals or companies who plant land receiving tax-free income on clearfell timber, as well as annual premiums, which increased between 2% and 7% in 2018.
Since 2015, the market for forestry land has become more competitive with some counties, particularly in the west of Ireland, noting a greater percentage of sales to forestry companies.
For this reason, the price paid for forestry land is also increasing. International investment funds, predominantly from Scandinavia, mainland Europe and London, continue to be active in the market.
However, the domestic market is also quite strong. The demand for forestry as an investment remains high.
The average price of forestry land in Ireland in 2018 was just over €4,900/ac, but typical values ranged from between €3,500/ac and €5,500/ac.
The average of just under €5,000/ac was brought up by a number of mature plantations that were bought by forestry companies.
Leitrim had the highest percentage of forestry sales in 2018. Almost 20% of all land transactions in the county were bought for forestry. Almost 15% of sales in Mayo were attributed to forestry, with Sligo (10.3%), Roscommon (10%) and Galway (7.7%) following suit.
Forestry continues to be a contentious issue, especially in Leitrim. However, there is anecdotal evidence to suggest that the volume of forestry sales in Leitrim eased over the latter months of 2018.
Public campaigns such as Save Leitrim have increased the number of appeals against plantations being sent to the Department of Agriculture, Food and the Marine’s Forest Service. While the appeals themselves may not be successful, a number of companies have reduced their activities in the county and are looking elsewhere.
As a result, we are more likely to see increased activity in various other counties where the average price is lower.
For every action, however, there is a reaction. In last year’s report, the observation was made that there was a vibrant interest coming from Cavan, Leitrim and Sligo for land in Roscommon. The rationale behind this was that land was being planted in the buyer’s home county and the premiums were being used to buy land in surrounding counties. This trend continued in 2018.
The re-emergence of international buyers became obvious around the country towards the end of 2018.
After the UK’s Brexit referendum in June 2016, buyers from the UK decreased significantly and Ireland’s country-home market felt the impact of this response. This trend continued in 2017 and into the first six months of 2018.
However, late last year, as the Brexit withdrawal date loomed closer, a noticeable switch in the trend occurred.
An increase in international buyers, particularly from the UK, began to re-enter the market in what auctioneers noted as a bid to invest money in the euro.
This wasn’t just the UK buyer. Agents nationwide noted parties from all over Europe, as well as America, were active in the country-home market. The property of choice for these buyers was a good-quality residential holding on 10ac to 30ac.
The price point of €850,000 to €900,000 seems to be the most popular among international buyers. A number of agents said that a residential holding in Ireland is a desirable purchase for international buyers. The lower stamp duty levels in Ireland have also facilitated international buyers.
The domestic market for country homes remains strong, especially around the Dublin commuter belt.
The market for larger, more expensive estates is much more specialised and it is therefore trickier to find a buyer, though a number were sold last year
Numerous residential properties on 20ac to 40ac in Kildare, Meath and Laois made substantial sums over the course of 2018.
The market for larger, more expensive estates is much more specialised and it is therefore trickier to find a buyer, though a number were sold last year. Castletown Cox on 513ac was sale agreed back in April for a sum believed to be around €20m, while Lisselan Estate on 315 acres in Co Cork was bought by Colette Twomey, owner of Clonakilty Black Pudding, for about €3m.
There are certain international factors also affecting this part of the market.
The influence of Chinese buyers reduced over the course of 2018 due to softening of Chinese interests in the western economies. It is believed a large estate in the midlands was in the process of being sold to a Chinese investor, only for the deal to fall through during the year.
The auction room
The number of public auctions increased by 34% last year across the country, with almost 550 property up for auction. The success rate at auction also grew.
Last year saw almost 51% properties offered for sale at public auctions sell under the hammer, up from 47% in 2016.
Meath had the most active auction room in 2018, with 47, followed by Kildare on 46, Roscommon on 39 and Tipperary with 35.
Wicklow and Wexford saw the highest number of properties offered at auctions sell under the hammer and they had the most successful rates of sale, with 74% and 66% of properties selling under the hammer respectively.
Just under 33% of farms offered to the market last year were by public auction. While this method makes up just one-third of farms offered, for numerous auctioneers it is the preferred method of sale.
Agents have noted the frustration that certain private treaty sales can bring. The advantage of a successful public auction is once the hammer falls, the deal is complete. The sentiment towards certain private treaty sales is they can drag out.
The outlook for 2019 will be interesting and how Brexit plays out will have a bearing on the market. Supply is back already this year as vendors have been encouraged to sit tight until Britain’s withdrawal date of 29 March has passed.
Predicting the future of the market is difficult when there are too many unknowns at this point.
This is a subscriber-only article
SHARING OPTIONS: