Agricultural land values decreased 0.2% in 2020, according to the Sherry FitzGerald agricultural land barometer, which pools sale results from the group’s almost-100 offices.

The weighted average price of farmland in Ireland, excluding Dublin, was approximately €8,850 per acre at the end of 2020, it found.

The year saw a great variance in farmland values, with contrasting forces exerting pressure at different times.

Deflationary pressures stemming from 2019 saw values decline in the opening part of the year.

COVID-19 then restricted sales activity, limiting price movements.

Recovery

The easing of restrictions later in the year led to the strongest rate of quarterly growth in quarter four in over five years, due to depleted supply and pent-up demand.

Values increased by 1% in quarter four, the strongest rate of quarterly growth since 2015.

Agents noted that along with the pick-up in activity in quarter four, there was also a notable improvement in buyer sentiment, in particular to what had been seen earlier in 2020 and much of 2019.

The increase in prices at the end of the year was evident across much of the country, with the midlands, mid-west and southeast recording growths of 2.1%, 1.9% and 1.6% respectively.

At the end of the year, values remained the highest in the mid-east, at approximately €10,700 per acre.

Upward movement

“The land market showed enormous resilience in 2020, in the face of a once-in-a-century global crisis,” said associate director Sherry FitzGerald country homes, farms and estates Philip Guckian.

“While the necessary health restrictions implemented to curb the spread of the virus undoubtedly had adverse implications for the economy and the land market, overall prices have held largely firm.

"Following the greater reopening of the economy, the second part of the year saw strong upward movement in prices.

“Looking further into 2021, I feel that this momentum in prices will continue, with the lack of supply of good-quality lands still an issue," he said.

"Dairy farming is showing strong signs of growth, and with this comes the need for grazing lands, which will subsequently increase demand for lands either through letting or sales.

"Beef prices remained stable and grain prices saw a slight increase in values in 2020. Considering all these factors, we may see a small increase in land values in 2021.”