LAND prices remained resilient last year despite the threat posed by Covid-19 and are predicted to rise by 4% on average this year, underpinned by a rise in farm incomes as well as strong demand and reduced supply.
According to the 2021 Society of Chartered Surveyors Ireland (SCSI)/ Teagasc Agricultural Land Market Review and Outlook Report, the average price of an acre of “good land” in Waterford came in at €11,000, the third highest in the province after Tipperary (€11,900) and Cork (€11,143).
Meanwhile, the price in Munster for an acre of non-residential land under 50 acres last year ranged from an average of €5,800 for poor land to €10,500 for good quality.
The report found that dairy farmers are driving the Munster market and that prices ranged from an average of €11,900 per acre in Tipperary for good land less than 50 acres – the highest in the province – to €9,000 in Clare.
The price for poor quality land ranged from an average of €6,500 per acre in Waterford – the highest price for this land type in the province – to a low of €4,700 in Clare.
The survey of 156 auctioneers and valuers from all over the country – which was conducted in February 2021 – found that demand for rented ground also remains strong with rents this year expected to rise by 5% in Munster, 6% in Connacht and 8% in Leinster.
Waterford-based auctioneer and SCSI member Des Purcell of Purcell Properties, said that lockdowns due to Covid had led to a reduction in the volume of sales.
“The inability to view holdings or physical auctions led to a significant increase in the number of sellers postponing plans to sell land,” said Mr Purcell.
“In our survey, over a third of agents (35%) reported a decrease in the volume of land sold in 2020 compared with 19% in 2019. Virtual viewing options have been available to sellers, but clearly many have a preference for more traditional auction sales.”
Des Purcell added: “Dairy farmers are the most active buyers and renters of land as they continue to strive to increase their farm size to achieve economies of scale. While Covid has affected sales activity, it hasn’t affected output or prices and as a result farmer confidence about the future has been unaffected. The land market has shown strong resilience throughout the pandemic and agents believe prices will rise on average by 4% this year.”
Said Teagasc economist Dr Jason Loughrey: “Looking at the various farm sectors, last year was a good one for sheep farmers in particular, as they benefitted from higher prices as did pig producers. Dairy farm incomes were stable while incomes on cattle rearing farms increased. There was no change on other cattle farms. Tillage farmers did have a disappointing year due to adverse weather conditions which led to low yields and a drop in income.”#