Average price of land in Westmeath could hit €13k an acre

SCSI auctioneers and valuers are forecasting that the price of agricultural land nationally will increase by 8% on average this year, underpinned by a strong dairy sector.

In a major new survey, auctioneer, and valuer members of the Society of Chartered Surveyors Ireland (SCSI), operating in the agricultural and rental markets say they expect national rental prices to increase at an even higher rate - an average of 14%.

They say prices will be driven by the constrained supply of land for rental and higher anticipated demand, particularly from the dairy sector due to new environmental regulations. However, experts from Teagasc note that milk prices have fallen back somewhat this year.

National average non-residential farmland prices in 2022 ranged from €5,564 per acre for poor quality land – up 5% from €5,308 in 2021 – to €11,172 per acre for good quality land – up 2% from €10,962 the previous year. The survey found that Kildare has the most expensive land in the country with good quality land going for an average €15,056 an acre, followed by Meath where the average is €14,867.

The average price of good quality land on holdings of less than 50 acres in Kildare is €15,333 per acre, followed by Meath on €15,200 and Waterford on €15,000. Tipperary on €14,938, Wexford on €14,857 and Carlow and Cork on €14,250 round off the top six places nationally. The average price of an acre of good land in Westmeath is €13,300, up from the €12,570 recorded in 2021.

In Leinster prices for good land in 2022 on holdings of less than 50 acres range is similar to the previous year at €11,500 in Offaly, while the prices for poor quality land range from a high of €9,417 in Louth to €6,000 in Longford. The average price per acre of poor land in Westmeath is €6,960 up from €6,140 in the previous survey..

Chartered Valuation Surveyor Dillon Murtagh from Murtagh Bros in Mullingar said strong demand for good quality land from dairy farmers is driving the market.

“Eighty-three per-cent of agents in our survey believe there is likely to be an increase in demand from dairy farmers to purchase farmland in 2023 and they are continually ranked throughout the survey as being the most likely purchasers of land across the country.

“However, as outlined in this report it’s also likely that changes to the European Nitrates Directive, particularly measures aimed at protecting water quality will have an impact on land prices, especially rental prices,” Mr Murtagh observed following the launch of the survey.

“In order to maintain current levels of milk production – and to comply with the directive - many dairy farms will need to either increase their land area or reduce milk production. We’d expect the impact on sales and rental prices will be more acute in regions where dairy is the dominant farm enterprise and where stocking rates are higher.”