Sales of agricultural land averaged £10,045/ac in Northern Ireland (NI) during 2020, up £89/ac, or 0.9% on the year previous.
It is only the second time that the NI average has passed the £10,000/ac mark, with the first being in 2018 when land averaged £10,182/ac.
Our findings are based on a survey of 158 sales which covered 5,024 acres across NI last year.
While the average land price is similar to 2019, there is evidence of a changing agricultural land market. At the top end, good-quality land continues to meet a very strong demand across NI, while prices paid for poorer land are moving downwards.
When ranked in terms of price per acre, the bottom 25% of land sales averaged £5,927/ac last year. This is £608/ac less than the corresponding value for 2019, which was £6,535/ac.
At the other end of the market, the top 25% of selling prices averaged £14,460/ac during 2020. This is almost identical to the 2019 value of £14,470/ac. “If you have good land to sell, you will be well paid for it,” one local auctioneer succinctly explained, “but middling land is harder to move”.
Smaller farms making higher prices
Our figures also firmly back up anecdotal reports that smaller farms make higher prices on a per-acre basis.
The average selling price for properties under 25 acres in size during 2020 was £11,015/ac. This compares to £9,939/ac for farms between 25 and 49 acres, and £9,640/ac for lots over 50 acres in size.
The trend stems from small lots costing less overall, so more potential buyers can afford them. This leads to more bidding, and they fetch higher prices accordingly.
There was significant movement in average land prices across NI counties last year.
The biggest jump of 9.5% was seen in Armagh. At an average price of £13,914/ac, Armagh remains the most expensive county for land in NI.
In Antrim, the average land price rose by 7.3% to £10,578/ac. There was a marginal drop of 1.1% seen in Down, where the average price sits at £11,246/ac.
The average land price eased back by 3.7% and 3.9% in Tyrone and Derry to £10,210/ac and £8,015/ac, respectively. The sharpest drop across NI counties was in Fermanagh where land averaged £5,776/ac last year, down 27% on 2019 levels.
With county averages in the Republic of Ireland (ROI) generally increasing last year, NI counties moved down the average price rankings across the entire island. That said, the land market in NI remains ahead of ROI.
When converted to euro, the average land price in NI is €975/ac higher than the ROI average of €10,316/ac. But this north-south price differential has narrowed considerably and compares to a gap of €2,400/ac in the 2019 land report.
The main driver behind the strong market in NI is the tight supply of land that is available to buy.
Our records show that there were 11,811 acres publicly advertised for sale in NI during 2020. The supply is down 12% on 2019 levels and is 27% lower than 2018. Across the total arable and grassland area in NI, the area publicly offered up for sale during the year equates to just 0.56%.
The first coronavirus lockdown affected the market earlier in the year, with the total area for sale running 19% behind 2019 levels at the end of June.
However, more land than usual came on the market during the summer which closed the year-on-year difference to 12% by the autumn.
On the demand side, local auctioneers report that good financial performance across most sectors meant there was more buying activity from farmers during 2020. In previous years, businesspeople with farming interests, and part-time farmers with other income, were key players in the NI land market.
Despite considerable uncertainty facing NI farming, from Brexit trade deals to new support schemes, there appears to be a positive outlook for the land market.
Supply is likely to remain tight and, on the demand side, land is seen as a licence to farm. In recent years, expansion for many NI farmers meant building a poultry or pig unit.
However, this has become difficult with strict planning rules around ammonia emissions. Expanding a farm business has come back to farming more land, and this is likely to have a positive impact on prices.
Farmers’ attachment to land and the desire to own more has been the plot of books, plays, and films. It is also the fundamental driver of the NI land market, and while the future of NI farming is unclear, the outlook for the land market is upbeat.
Hill land averages £2,895/ac
In a separate survey of hill ground and rough grazing, the average selling price in NI last year was £2,895/ac. This represents an increase of £191/ac, or 7.1%, from the 2019 survey.
The quality of land and subsequent selling prices in this survey varies widely.
It ranged from £910/ac for 35 acres of blanket bog in Derry, to £4,667/ac for 15 acres of marginal parkland in Fermanagh.
Details of all agricultural land in NI that was publicly advertised for sale in newspapers and online during 2020 were recorded and selling agents were later contacted for updates on sales.
Only land that could be described as arable, cuttable for silage or good-quality grazing was included in the main NI survey. The auctioneer’s valuation of other features such as houses or building sites were deducted from sale price if it inflated the per-acre land price.
We extend our sincere gratitude to the auctioneers and estate agents that participated in the survey.