THE Society of Chartered Surveyors Ireland (SCSI) is forecasting that the price of agricultural land nationally will increase by 6% on average this year, mainly due to an expected recovery in milk prices and continuing strong demand from farmers and investors.
In a major new survey, auctioneer and valuer members operating in the agricultural sales and rental market say average rental prices in 2024 are expected to increase by 4%.
The survey found that on holdings under 50 acres, Carlow had the third most expensive land in Leinster and the fifth most expensive in the country, with good-quality land going for €15,750 an acre – up from €14,250 last year.
According to this year’s survey, after Waterford, the most expensive land on small holdings was in Tipperary, followed by Kildare. The average price of good-quality land on holdings of less than 50 acres in Tipperary was €17,539 per acre, followed by Kildare on €16,400, Meath on €16,225, Carlow on €15,750 and Cork on €15,667 round off the top six places.
In Leinster, prices for good land in 2023 on holdings of less than 50 acres range from Kildare’s high of €16,400 – up from €15,333 the previous year – to €11,750 in Offaly, while the prices for poor-quality land ranges from a high of €9,600 in Kildare to €6,583 in Longford.
The price of an acre of poor-quality land in Carlow was €8,625 per acre – up from €8,250 in 2022. Meanwhile, the price of an acre of good land on holdings between 50 and 100 acres last year in the county was €16,250, while the price of an acre of good land on holdings over 100 acres was €14,750. The corresponding prices for an acre of poor land were €7,875 and €7,500.
Auctioneer John Dawson of REA Dawson in Tullow, who is a member the SCSI’s Rural Agency Committee, said that while demand for land – primarily by dairy farmers – had continued to drive land sales and rental price increases last year, price expectations for 2024 have moderated due to a number of factors.
“We can see this most readily in the rental market, which reacts more quickly to economic changes in farming. Last year, average rental values increased by just 4.5% across all farming uses despite predictions of double-digit growth similar to that which occurred in 2022. These increases did not materialise, due in the main to poorer overall returns in farming and very poor weather conditions, which dampened demand from some farming sectors – particularly in Leinster and Connacht/Ulster – and kept a lid on rental inflation.”
“While land values are expected to increase again this year, mainly due to an expected improvement in milk prices and strong interest from farmers and investors, the increases are forecast to be an average of 6%, well down on the double-digit growth recorded last year. On a provincial level, Leinster, Munster and Connacht/Ulster are projected to experience an increase of land values by 4%, 11% and 5% respectively,” said Mr Dawson.
Teagasc economist Dr Jason Loughrey said that while milk prices should be higher in 2024, the outlook for the cereals sector remains negative. He highlighted the likely negative impact of recent weather conditions on economic outcomes at farm level and the uncertainty of the weather conditions for the rest of this production season.
The full report is available at https://scsi.ie/land/
