Munster land prices up 14%

Land prices rose 14.3% last year for holdings of up to 50 acres in the dairy stronghold of Munster, but poor access to banking finance is impeding growth, a report has found.

Demand is also strong in Leinster, where prices were up 13.9%. However, prices rose just 2% in Connacht/Ulster versus 2012, according to the Society of Chartered Surveyors Ireland/Teagasc Land Market Report.

Land rental activity levels are up 5% in the first quarter of 2014.

Teagasc director Gerry Boyle said: “Good information on land sale and rental price developments is vital for farm business planning and in this context the report is to be particularly welcomed. Due to milk quota removal dairy farmers, in particular, will have an interest in this publication.”

The national average is €10,721 per acre for land parcels of up to 50 acres with entitlements and a residential holding.

In Dublin, it is €13,000; Leinster it is €11,132; Munster €11,378; and Connacht/Ulster €7,375.

SCSI chairman Trevor McCarthy said: “New dairy farms will need to be established to meet the increased output targets of 50% increases in milk production in Food Harvest 2020.

“The current level of land transfer for sale is, however, minimal — with just 0.5% of all land transacted annually. This lack of supply is becoming an issue, particularly in the context of Food Harvest 2020 and we hope that measures to improve land mobility are considered by government.”

Mr McCarthy added that farmers believe that access to finance is the biggest hurdle facing expansion, with farmers’ purchasing power often be impacted by fluctuations in commodity prices.

Meanwhile, the IFA has joined with the Vintners Federation of Ireland, Irish Property Owners Association and RGDATA to signal to Government the approach to negotiations between banks and SMEs in dealing with credit difficulties is not working.