The average price paid for agricultural land in Northern Ireland (NI) hit a record high last year of £14,736/ac.

The figure represents an increase of 6.8%, or £942/ac, compared to 2023 levels. The land market experienced a significant jump in Armagh and Down, where average prices were up by 14.6% and 12.9% to £20,174/ac and £19,831/ac, respectively.

There was a more modest price rise in Tyrone, with the average increasing by 4.2% to £14,142/ac.

The average price in Derry and Antrim reduced marginally by 1.4% and 2.4% to £11,237/ac and £13,951/ac, respectively. In Fermanagh, the land market eased back by 3.5% to an average price of £8,867/ac.

Whilst the market in NI rose across all types of land, our figures indicate that price rises have been more pronounced for better-quality land.

When ranked according to price per acre, the top 25% of land sales in NI during 2024 averaged £22,782/ac.

This is £1,066/ac more than the same figure for 2023. At the other end of the market, the bottom 25% of sales averaged £8,626/ac last year, which is just £588/ac more than the year previous.

Our figures are for bare land only, so the likes of houses, building sites and farmyards are not included.

However, separate calculations which include these features show the total price paid for these properties equated to £19,410/ac last year.

This represents an increase of 5.6%, or £1,024/ac, when compared to 2023. Existing farm buildings are expected to be worth more in the years ahead, as tight rules around planning restricts the construction of new sheds.

ROI comparison

The prices paid for agricultural land in NI remain much higher than in the Republic of Ireland (ROI).

When converted to euro at the average exchange rate for 2024 (€1=£0.85), the difference between the NI and ROI average for bare land stands at €4,856/ac, up from €3,925/ac in 2023.

The price rise in the NI land market occurred even though the total supply of land offered up for sale hit a five-year high last year. Our records show that 13,711ac came on the market during 2024, which is an increase of 21%, or 2,341ac, when compared to the year previous. The figure is the highest annual total seen since 2018, when 16,078ac were advertised for sale in NI.

While the total area advertised for sale rose sharply, it still equates to just 0.65% of the region’s overall grassland and arable area. At that rate, a given area of land will only be on the market publicly once every 154 years.

This tight supply of land available for sale remains a major factor underpinning the NI land market.

Land buyers

Auctioneers across NI indicate that farmers were the main buyers in the land market last year.

A relatively good year across most farming sectors boosted cash reserves and injected confidence into farming. When that happens, the land market usually experiences a lift.

Unlike other parts of the UK, companies that want to buy up land to offset greenhouse gas emissions are not active in the NI land market. Our prices are too dear, and lot sizes are too small.

That said, the likes of the Department of Agriculture is still keen to buy parcels for tree planting.

In October 2024, the bombshell was dropped that Agricultural Property Relief for inheritance tax across the UK would be limited to £1m, including any Business Property Relief.

Anaerobic digester operators are active land buyers too and were responsible for some of the highest prices paid in NI last year. There was also the usual mix of farmers with off-farm income and business people with farming interests in the NI land market. Those who made money elsewhere and buy land in NI tend to be from farming stock. Wealthy people who have no farming connections and are buying land to avoid inheritance tax are not common in NI.

In October 2024, the bombshell was dropped that Agricultural Property Relief for inheritance tax across the UK would be limited to £1m, including any Business Property Relief.

Despite the furore among the farming community, most auctioneers indicate that it had relatively little impact on buying activity for land. It highlights how farmers view purchasing land as a long-term investment. Announcements by politicians seldom have an effect.

Inflation

The Irish Farmers Journal has been surveying land prices in NI for 15 years and, as the line graph opposite shows, prices have been on a general trend upwards over that period. The prices we report are actual values, so they are not adjusted for inflation.

Interestingly, when inflation is considered, it paints a different picture. For example, when the 2010 average land price of £9,585/ac is adjusted for inflation, it is worth £14,529/ac today, which is only £207/ac less than the 2024 average price. So, whilst land prices in NI have risen in actual terms, the market is relatively stable in real terms. How relevant this is to on-the-ground farming is up for debate.

The prices that farmers receive for their produce don’t tend to rise with inflation after all.