The year 2016 has been a more positive year in the agricultural land market and indeed across the board,” says Pat Quirke, Clonmel, Co Tipperary.

“There is more finance available – I think banks reigned themselves in because of dairy fears earlier in the year but they are freer now. I found in 2016 that less land traded hands but the market was strong.

“There is a limited amount of land traded in south Tipperary in comparison to the rest of the country. We have stud buyers and a strong history of business people buying farms in the region.

“Dairy has expanded again. We have quite a lot of new entrants here but many of these are business people who hire a manager and set up a farm and run it as a business. That is different to conversions from beef and tillage in many other parts of the country.

“Here agriculture is very much business orientated because they’ve had to compete against stud farms or other business people. Grain farming is very strong but they’re finding it very hard to buy land. Farmers are being channelled into buying in certain areas and this is affecting land values. On average, land is making between €10,000 to €12,000/acre, whereas on paper it might be valued at €7,000 to €8,000 but demand is driving it up.”

Forestry land

“Forestry-type ground in these parts is probably pushed beyond where a lot of people would see it as being viable.

“Because the top land in the region is being bought by people who are not relying on farming for their income, everything else below this is being dragged up. Even poorer quality ground is making €5,000 to €6,000/acre, which from a forestry perspective we’re told won’t work. People are still going ahead and buying these type of parcels and draining them in a bid to increase their value.

“Land with tillage and dairy potential is making €12,000/acre upwards. A lot of rented tillage ground has been pushed into leases. Grass rental is very much on a conacre basis, but even that is getting pushed into leases now for tax benefits.

“I suspect that grass ground will certainly make between €200 to €300/acre in 2017. Tillage farmers are looking to pay a bit less, but at the same time nobody has walked away from it either as a lot is already ploughed and planted.”

Housing

“Rural housing is a very hard sell – town houses are selling very well but there is not huge demand. I have a three-bed house in Clonmel and I expect it to be let in less than a week. On the other hand, I have a three-bed rural house that has had two viewings in three weeks.

“Employment dictates a lot in terms of rural housing in south Tipperary, with industry a big employer here.”

>> Tom Spillane, Killarney, Co Kerry

“Prices are relatively steady. I would have thought maybe it toughened a little this year but exceptional land will make exceptional prices, if you have two or three people going for it. If it’s a smaller parcel, you could be up to €15,000 or €20,000, in some cases even up to €25,000 per acre – but that is the exception.

“For general blocks of 30 to 40 acres, this year it’s making €9,000 to €10,000 per acre. Last year you would have no problem getting €10,000 or €11,000/acre. The agricultural land market has been very good in Kerry – I think it has bucked the national average. When good land, which is scarce, comes up there is always a readymade demand out there for it. The success of the Kerry group and the farmer shareholders has helped matters.”

A bit tougher

“The agricultural market has been a little bit tougher than 2015, we definitely brought less farms to the market. We brought four farms to the market and we like going down the public auction route – it’s a more transparent and decisive way to sell a farm. Of the four farms, two were sold under the hammer and I think they benefitted from local interest. The other two were subsequently sold by private treaty afterwards.

“One farm in particular that stands out was near Castleisland. A fine level grassland farm in a very productive agricultural area. I suppose the danger signs went up when that didn’t sell at auction – obviously people were taking an overview of the market and maybe weren’t as buoyant as the year before, particularly the dairy men with the price of milk going back. No doubt about it, it definitely impacted on that sale. We subsequently sold it but funnily enough not to a dairy man.

“In three of the sales, it was drystock farmers who purchased them – they were consolidating around their home place. With regard to marginal land, you’re into forestry-type land and there is solid demand for it. Forestry companies are definitely buying the bare land – it’s making €4,000/acre, maybe €4,500/acre if it’s reasonably good. That would be the market value. We have a few mature plantations with no premiums but the market for these is a lot tougher.

“In terms of housing, we have the benefit down here of having some fabulous rural coastal areas. If there’s something with coastal views or if it’s on the ring of Kerry or the Wild Atlantic Way, then you’re at a different level. Rural or coastal, as isolated as it may be, it can also be spectacularly beautiful. Old cottages and houses with good aspects always make top prices. For any of our American, English or continental customers, they cannot build on a site so they need to look at something that’s habitable.

Drop in sterling

“The drop in sterling has been massive but on the other hand, from my experience, the value of property in England has gone up. Someone selling a one-bed flat in London could get up to £500,000, which if converted would give you a magnificent detached family home here and plenty of change.”

>> Henry O’Leary,

Clonakilty, Co Cork

“The price of land was very strong at the end of 2014 and start of 2015. I wouldn’t say that it has come back but I’d say it has plateaued off this year. 2015 to be fair was good – it’s only this year there has been a lot of uncertainty even though we’ve probably come through it at this stage.

“Land is making between €10,000 and €15,000 an acre depending on demand, quality and enterprise in the locality. Dairy farmers are probably the strongest buyers and it’s very hard to see a tillage farmer competing with them at present. Demand is strong here because west Cork has always had smaller farms but the days of the smaller farmer is certainly limited. They either have to get bigger or get off-farm income, especially with the ambition of trying to grow the business.

“It doesn’t matter what the price of milk, grain or beef is like, everybody knows that’s temporary. If a piece of land comes up next to you, you have to look at the lifetime implications – maybe the implications of two lifetimes given that it happens so rarely. If you are a dairy farmer, you have to buy ground if it’s within cow-walking distance.”

Returns from farming

“The immediate returns from farming probably has a bigger bearing on the way that financial institutions think with regard to lending than to a farmer’s willingness to buy. The farmer will take a much longer view on it and accept the peaks and troughs, farming is rarely static. Farmers are risk-takers – maybe not through choice but they are all risk-takers.

“If you ask why aren’t some farmers buying? It’s probably because the bank manager isn’t supporting them. Farmers are probably some of the bravest buyers out there and they do put their neck on the line but wanting to do it is one thing – you have to get the support of a financial institution as well and I think that’s a major issue at the moment. You need a willing bank manager in the area to support the farmer.

“We would be very reluctant to go to auction with a farm at the moment because the man who wants to buy may not have the money sanctioned at the required time. It might take two or three weeks longer than originally planned.

“Having old dwellings on a site is like almost guaranteeing planning permission for a lot of people where planning is gone so tight. It’s not the house someone is buying, it’s the location or permission to build. Farmers’ children are finding it increasingly harder to get planning – it’s certainly not a given. There was a time here when sites were freely making €200,000 to €250,000 and a farmer didn’t have to think too long and hard whether to sell a site or not. Rural site values have dropped down significantly to between €50,000 to €100,000, and getting planning is a problem. So farmers are reluctant to sell them now.

Rental market

“The rental market next spring will certainly test the bravery of tillage farmers. But the fact is, a lot of them are already in long-term leases so it’s really only going to impact on new leases. A lot of people are in five- or seven-year leases because of the tax incentives. Supply of rental land is tight because any farmer in a rental scenario is happy to keep it.

“New leases may well be back a little, simply because competition might not be as strong as a lot of tillage farmers got a bit of a roasting this year. We’re in an area where land is scarce and demand is strong.

“Forestry-type ground is strong and there is serious demand for it but large plots are in short supply. Some forestry companies are willing to pay as much as €5,000/acre, which is up form €4,000/acre, for good-quality parcels. It’s still less than half what good farm land will make. Strong demand for forestry land is establishing a very firm base under agricultural prices.

“Whatever about the effects of Brexit, it’s the uncertainty of it that is the real problem. We have a lot of UK clients and some may want to live here now more than ever. These clients would be clearer in their thinking if Brexit was sorted and they knew the value of sterling going forward.”

42-acre farm up for grabs near Drangan

A 42-acre residential farm has just come to the market in Co Tipperary. Situated at Newtown, Drangan, the property features dual road frontage, a southerly aspect and has great scenery.

The land is all in grass and while of good quality, would benefit from minor investment in terms of drainage, fencing and fertility. The three-bed two-storey farmhouse is in need of modernisation but has oil heating and PVC windows.

Outbuildings include a stone coach house and a two-span haybarn. The property is for sale by auction on Tuesday 15 November in the offices of PF Quirke & Co Ltd, Clonmel.