Big investors put their faith in farmland rather than man-made institutions
On top of that, certain banks are willing to at least part-finance land purchases.
This constitutes a flow of money into the rural property market, manifesting itself through continued sales. But the real motivation to buy comes from the farmer himself.
Even with favourable economic conditions prevailing in farming at the moment, it is still quite a commitment to pay out between €10,000 and €15,000 per acre. Is it a case of superfluous money in the business trying to find a home, or is it simply in the blood of every Irish farmer to expand his holding?
“Where you have a progressive farmer, then he aspires to purchasing more land than he inherited,” says an auctioneer in Co Limerick. “It depends on how active and how committed the particular farmer is. I wouldn’t say that all farmers aspire to having more land.”
A north Cork agent is more emphatic about the expansionist pretensions of the average Irish farmer. “Oh yes. All professional farmers want to expand,” he says. “They all want to improve; they all want to increase their holding, their herd and their quality. It’s as simple as that.”
“What a lot of farmers want to do,” says another agent in Co Limerick, “is rather than holding onto any extra cash they might have, they would prefer to put it into purchasing more land rather than leaving it lying inside a bank, considering all the economic upheaval that’s going on.”
Éamonn O’Brien of land specialist auctioneers CCM agrees, and also points to the tendency of investors to put their faith in land for agricultural use rather than in man-made institutions.
“One thing that we’re noticing here at the moment is that people that have money are more nervous than people that don’t. For example, I had one elderly gentleman who bought a piece of land through us, and the reason he wanted it, he said, was because ‘it would be there for my wife in years to come, for my children and my grandchildren and I’d be anxious that what moneys we have at the moment would be kept secured for her in the form of a piece of land’. We also have had young professional clients purchasing land with the same notion of ‘banking’ it to help secure their children’s future.
“Land will be there for a thousand years. Bricks and mortar have to be maintained, and you don’t know what planning policy will be like 10 or 15 years down the line.”
