The value of agricultural land in Ireland in 2021 saw its highest rate of growth since 2013, according to estate agent Sherry FitzGerald.
In the year, agricultural land values nationally – excluding Dublin – rose by 6.4%.
This is a large increase on 2020, and was the strongest rate of growth recorded since Sherry FitzGerald began publishing this information nine years ago.
The graphic below indicates the rate of change in land value between quarter four (Q4) of 2020 and Q4 of 2021:
The weighted average price of farmland at the end of quarter four (Q4 ) of 2021 stood at approximately €9,400/ac. The rise in values has been evident nationwide, the real estate agent says, with growth in agricultural land values noted across all regions.
The border region (counties Donegal, Sligo, Leitrim, Cavan and Monaghan) recorded year-on-year growth of 13.2%; with the southeast (counties Wexford, Waterford, Kilkenny and Carlow) recording growth of 7.9%; and both the mid-east (counties Louth, Meath, Kildare and Wicklow) and west (counties Galway, Mayo and Roscommon) recording growth of 6.4%.
At the end of 2021, land values were highest in the southeast, and stood at approximately €11,430/ac. Growth was recorded across all quarters of 2021, with the final quarter of the year seeing agricultural land values increase by 1.4%.
Breaking this data down along grassland and arable lines, the former outperformed the latter in 2021.
The below graph indicates the annual change in value for prime grassland between Q4 2020 and Q4 2021:
In total, prime and marginal grassland values increased 7.3% and 7.7% respectively, while arable land saw year-on-year growth of 4.9%.
At the end of 2021, the weighted average price of prime arable land nationally, excluding Dublin, stood at approximately €11,200/ac, while the weighted average price of prime grassland and marginal grassland stood at €10,650/ac and €6,400/ac respectively.
The below graph outlines the annual change between Q4 2020 and Q4 2021 for prime arable land:
Commenting on these findings, Phillip Guckian, associate director with Sherry FitzGerald for country farms, homes and estates, said: “In 2021, there was notable growth in agricultural land values across the country. This comes as no surprise, given the lack of good land and farms that came to the open market in the year.
“This resulted in many instances of competitive bidding, putting an upwards pressure on prices,” Guckian added.
“The dairy and tillage sectors were the main drivers of demand for land in 2021 and we’d expect this to continue in the new year, with the rise in milk prices being reflected in the strong growth in the value of grazing land.
“Further increases are expected again in 2022 unless there is a notable pick-up in supply,” he noted.
The Sherry FitzGerald associate director explained that the residential farm sector proved popular in 2021, particularly with young farmers looking to expand with their families, as well as purchasers from abroad looking for space and privacy around their homes.
“The market also saw strong demand from farmers looking to lease land,” Guckian concluded.