2.12 Land Utilisation, Prices, and Land Mobility

2.12 Land Utilisation, Prices, and Land Mobility

According to the CoA, the total agricultural area utilised (AAU), excluding commonage, is 4,509,256 hectares, made up of 3,699,919 hectares under grassland, 451,537 hectares under rough grazing, 265,592 hectares under cereals and 92,208 hectares under other crops, fruit and horticulture uses.

There is a further 421,287 hectares of commonage land which is held in common ownership on which two or more farmers have grazing rights. A quarter of all the commonage in Ireland is in Mayo, with almost half of all commonage between the three counties of Donegal, Galway and Kerry. Six counties have less than 1,000 hectares of commonage, namely Kilkenny with 491 hectares, Offaly with 209 hectares, Longford with 200 hectares, Meath with 59 hectares, Westmeath with 4 hectares and there is no commonage in Monaghan.

700,000

Figure 2.27 Land Utilisation in Hectares by Region, 2020

600000

500,000

400,000

300,000

200,000

100,000

0

Border West Mid-West South-EastSouth-West Mid-East and Dublin

Midland

Commonage Rough grazing Grassland Cereals Other crops,

fruit and horticulture

Source: CSO

CSO Agricultural Land Prices In May 2023, the CSO released the Agricultural Land Prices 2021 publication. The publication presents estimates of Agricultural Land Prices for both arable land and permanent grassland per acre at the state and regional level. In interpretation of these figures, allowance should be made for the fact that only a small amount of agricultural land is sold each year. The volume of eligible land sold in 2021 was only 1.3% of the total agricultural land area as detailed in the most recent CSO Census of Agriculture. As the statistics relate to the land sold purely for agricultural use, a number of different transaction types are excluded from the statistics such as transactions for non-agricultural purposes, land identifiable as forestry, transactions with entitlements related to the land, inheritance transfers, commonage land or areas of land less than 0.2 hectares.

According to the CSO in 2021, there was 58,645 acres of agricultural land sold in Ireland. This was up from 48,537 acres sold in 2020 (note the CSO have revised this figure upwards from 29,031 acres in their 2020 publication). The median price was €7,501 per acre and the total value of land sold was €476.5 million. The total value of land sold was up 42% on the 2020 value of €334.9 million, with the volume of land sold up 21%. The median value per acre, or the value directly in the middle when the transactions are sorted in order of price per acre, was up 7.4% on 2020.

Over the nine years between 2013 and 2021 the median price of agricultural land increased in value by 17% while the volume of land sold has fallen by 18% over the same period.

Table 2.9 Volume and Value of Land Sales, 2013 – 2021

Year Median Price Mean Price Number of Volume of Value of Land € / ac € / ac Transactions Land Sold Sold Acres € Million
2013	€6,390	€6,089	3,980	71,684	€436,476,701
2014	€6,899	€6,722	3,547	65,848	€442,647,691
2015	€6,791	€5,786	3,116	66,398	€384,145,744
2016	€6,576	€5,520	2,951	62,533	€345,161,613
2017	€6,831	€5,609	3,354	70,735	€396,775,812
2018	€6,951	€6,455	3,050	55,145	€355,949,924
2019	€7,047	€7,721	3,429	59,199	€457,052,808
2020	€6,987	€6,900	2,812	48,537	€334,919,849
2021	€7,501	€8,126	3,541	58,645	€476,538,291

Source: CSO

The CSO give a breakdown of sales by land type which are determined by the CSO’s Census of Agriculture. The two classifications they use are “Arable Land” and “Permanent Grassland” and these differ greatly in price. The median price for arable land in 2021 was €14,756 per acre while the median price for permanent grassland was €7,309 per acre. The number of transactions also varies by land type with just 113 arable land transactions in 2021, while 97% of the transactions (3,428) were for permanent grassland.

Table 2.10 Volume and Value of Land Sales by Land Type, 2019 – 2021

Year Median Price Mean Price Number of Volume of Value of € / ac € / ac Transactions Transactions Transactions Acres € Million
Arable Land
2019	€11,886	€20,721	115	2,649	€54.89
2020	€12,032	€11,701	114	2,098	€24.54
2021	€14,756	€20,375	113	2,353	€47.94
Permanent Grassland
2019	€6,859	€7,112	3,314	56,550	€402.16
2020	€6,834	€6,683	2,698	46,439	€310.38
2021	€7,309	€7,614	3,428	56,292	€428.60

Source: CSO

Close to one quarter of all land sale transactions in 2021 were in the West region, which comprises of counties Galway, Mayo and Roscommon, where there were 838 transactions. In comparison there were just 26 transactions in county Dublin. However, of the 838 transactions in the West there were no arable land sales, nor was there any arable land sold in the Border region of counties Cavan, Donegal, Leitrim, Monaghan and Sligo. In Dublin, 18 land transactions were for arable land, while there was 8 for permanent grassland.

900

Figure 2.28 Number of Transactions by Region - All Land Types, 2019 - 2021

800

700

600

500

400

300

200

100

0

Border Midland West Dublin Mid-

Mid- West

South-

South-

East

East

West

2019 2020 2021

Source: CSO

The median price of land sold per acre has not varied much over the period 2019 to 2021 apart from in county Dublin. In 2021 the median price in Dublin reached €38,863 per acre up from around €15,000 in the previous two years. Agricultural land prices in Dublin are the highest in the country with land on the east coast of Ireland more expensive than on the western side. The west region and the border region were the only regions where the median land price was below the median price across the state.

€45,000

Figure 2.29 Median Price per Acre of Agricultural Land by Region, 2019, 2020 & 2021

€40,000

€35,000

€30,000

€25,000

€20,000

€15,000

€10,000

€5,000

€0

Dublin Mid-

South-

South-

Midland Mid- West

State West Border

East

East

West

Source: CSO

The total value of land sales in 2019 was €457 million. This dropped to €335 million in 2020 partly due to the restrictions imposed by COVID-19, but the total value rose up to over €476 million in 2021. While close to a quarter all land sale transactions in 2021 were in the West region the total value of the sales represented 12% of total land values. Close to one fifth of the value of land sold was in the mid-east region of counties Kildare, Louth, Meath and Wicklow.

€100,000,000

Figure 2.30 Total Value of Land Sold by Region, 2019 - 2021

€90,000,000

€80,000,000

€70,000,000

€60,000,000

€50,000,000

€40,000,000

€30,000,000

€20,000,000

€10,000,000

€0

Border Midland West Dublin Mid-EastMid-West South-

South-

East

West

2019 2020 2021

Source: CSO

Other Land Sales Data Along with the land price statistics published by the CSO, the Society of Chartered Surveyors Ireland (SCSI) and Teagasc publish an agricultural land market review and outlook each year, while the Farmers Journal publish an agriculture land price report each year.

The SCSI/Teagasc review released in April 2023 indicated that the volume of land sales in 2022 continued to increase, although at slightly lower levels compared to 2021. It forecasts that national farmland values will rise by up to 8% on average in 2023.

The Farmers Journal reported that there was continued strong demand for good farmland in 2022 with prices up by about 3%, while indications are that there will be even stronger demand in 2023.

Land Mobility & Long-term leasing A key policy objective of the Agri-taxation was to increase the mobility and the productive use of land. It recommended the retention and enhancement of the income tax relief for long-term leasing, which has a number of advantages over the conacre system of land rental, it:

Allows young farmers and new entrants to the sector gain access to land by providing M a cheaper means of long-term access to land, as opposed to the relatively high cost of ownership.

Provides security of tenure and the certainty required to encourage lessees to maintain and M make an investment in improving land.

Is especially important in accessing bank credit, as financial institutions generally match M loan terms to lease duration and longer duration means more manageable repayments.

Provides a route to retirement for older farmers, assisting in generation renewal. M

It also provides for better regulation of the land rental market. M

Since 2014, there has been a significant shift from the short-term renting (conacre) system to long-term leasing. The main official source of data in this regard is from Revenue income tax returns, which show a steady rise in the number of long-term leases over the past 10 years from just under 3,600 in 2011 to almost 13,000 in 2021. The tax relief available to farmers over this period has increased six-fold from €6 million in 2011 to €38.4 million in 2021.

14,000

€45

Figure 2.31 Number of long-term leases and cost of associated tax-relief in €million, 2012 to 2021

€40

12,000

€35

10,000

€30

8,000

€25

€20

6,000

€15

4,000

€10

2,000

€5

€0

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Number of Leases

Cost of Associated Tax-relief(€m)

(left axis)

(right axis)

Figure from page 75

Leasing and Rental Data The CSO notes that only 1.3% of agricultural land is sold annually. This means that leasing plays an important role in the agricultural land market. Due to the high demand for land, coupled with a low turnover of land via market sales, the leasing and letting markets are a competitive marketplace. This results in land rental prices aligning with the economic profitability of farming, compared to the sales market, where prices for land sold regularly exceed levels that would be justified by the returns from farming.

According to the SCSI/Teagasc review, land rental prices increased for almost all categories in 2022, the exception being land suitable for potatoes in Leinster where the rental price fell by about 5% to €439 per acre, the highest rental price for any land type or region. The Connacht/ Ulster region saw rental values increased by just 1% for land suitable for grazing, and by 5% for land suitable for grazing/ meadowing/silage, while in Munster and Leinster rental prices were mostly between 10% and 15% up in 2022 compared to a year earlier.

Table 2.11 Land Rental Values Per Acre

Year Grazing/ Grazing only Cereal crops Beet, Maize, Potatoes meadowing Beans /silage
LEINSTER (excluding Dublin)
2021	€245	€215	€259	€323	€463
2022	€266	€248	€290	€370	€439
% Change	9%	15%	12%	15%	-5%
MUNSTER
2021	€231	€221	€244	€256	€326
2022	€261	€241	€283	€300	€383
% Change	13%	9%	16%	17%	17%
CONNACHT/ULSTER
2021	€168	€161	no data	no data	no data
2022	€176	€162	no data	no data	no data
% Change	5%	1%	N/A	N/A	N/A

Source: SCSI/Teagasc

Figure from page 76