Huge decrease in midland farm land prices
SALES of farmland fell by half in the midlands in 2009, reported independent global property consultants Knight Frank Ireland.
The average price paid for farmland in Laois, Offaly, Meath, Westmeath, and Longford was n11,318 per acre in 2009, compared to the average price of n20,550 in 2008, the survey found.
This equates to an average drop per acre for the region of 45 per cent, which the estate agents say represented a huge decrease in the price of land, as much as an average of n9,232 per acre, over the past 12 months.
However, sales were up in 2009. There were 29 reported land sales, a slight increase on the 2008 total of 24 sales. The average price paid for small holdings, those in the 20 to 49 acre size category, in 2009 was n11,298 per acre, down from the previous year’s average of n17,140 per acre. There were 15 sales in this category.
In the next size category of 50 to 99 acres, the price remained more or less steady in 2009 with an average price of n12,167 per acre paid. In 2008 the average price was n13,882 per acre.
There were four reported sales in the 100 to 199 acre category in 2009 with an average price of n9,246 per acre. Knight Frank sold Rooske House, Edenderry on 130 acres at auction for n1.26 million. In the 200-acre plus size there was just one sale, a property that was sold privately by Knight Frank Ireland.
The national average price paid for farmland in 2009 was n9,678 per acre. This represents the drop of 43.3 per cent, based on the average price of n17,081 being paid per acre for sales in 2008 (excluding the Dublin, Kildare and Wicklow region). Sales in 2008, with an average price of n21,145 paid per acre for the entire country, fell nationally by 16.8 per cent.
While farmland prices declined significantly countrywide in 2009, but nowhere as much as in the Dublin/Kildare/Wicklow region, which saw the biggest fall where prices dropped on average by as much as 56.6 per cent.
For the first time in the 17 years since the survey was first undertaken by Ganly Walters, there were no recorded land sales at all in Co Dublin. This total lack of sales would account largely for the huge 56.5 per cent year on year drop in the Dublin / Kildare / Wicklow region.
Commenting on the agricultural land market survey results for 2009, Knight Frank Ireland’s, Robert Ganly said that the overall decline in farmland prices over the last two to three years mirrors the general decline across property markets in Ireland and internationally.
“The high prices that were paid for agricultural land up to 2007 were mainly non-farmer driven and it is our belief that the market has now stabilised”, he stated, adding that access to credit has had a major impact on the market over the past 12 months. Mr Ganly believes that the decline in land prices over most of the country should level off in 2010, with prices now having fallen back to realistic levels.
On a bright note the land market seems to be moving again, according to Robert Ganly. The survey found that in 2009 there was an increase in the number of successful sales at 123, up from 110 in the previous year. 2008 had seen a decrease in successful sales (down from 154 to 110), as had 2007 (down from 261 to 154).
The volume of farmland sold nationally in 2009 was way up at 9,693 acres, for a total value of n93,840,000, partially attributable to the fact that this year Knight Frank extended its research in this area.
The survey also showed that the average plot size has also significantly increased to an average of 78.8 acres in 2009, compared to just 52.2 acres in the previous year. Interestingly, this figure is way up on the 2007 average plot size of 64.5 acres and on the 2006 size, when the average plot size was 54 acres.
Another noticeable trend was in 2009 was that, similar to 2008, there were very few farms of 200 acres plus for sale throughout the country. Looking ahead to 2010, Robert Ganly says that “we expect to see further transactions in the open market this year. We believe that prices have now stabilised and could even, in some prime locations, increase during the year as we envisage more confidence returning to the market and expect a freer flow of credit.”
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