Boom time is over in Ireland

7 June 2002

Boom time is over in Ireland

Ireland is the only country

to share a border with the

UK, but historically land

prices have been much

higher. Andrew Shirley

checks out if the market is

still sizzling

IT SEEMS as if the Celtic tiger has finally had to stop and draw breath. Up until the beginning of last year, Irish land values were on what appeared be an unstoppable roll, driven ever higher by the scarcity of land for sale and huge amounts of EU and investment cash flooding into the country.

According to the annual land price survey from Ganly Walters, the Emerald Isles largest agent, the average price for agricultural property hit the dizzy height of k8990/acre (£5484/acre) by the end of 2000, something the UKs farmers, selling their holdings for less than £3000/acre (RICS figures), could only dream about.

But the situation has changed somewhat since then. During 2001, prices slipped back to k7917/acre (£4829/acre), and Callum Bain, a director at the Dublin-based firm, reckons they may edge slightly lower by the middle of this year.

"A lot of the money fuelling the boom was being spent by farmers who had sold off land for development. Now most of the cash for the projects currently in progress has been paid out and there will be a lag until funds for new schemes become available."

Falling commodity prices, foot-and-mouth and a general uncertainty in the market after the events of September 11 also played their part, points out Mr Bain, although he is still confident the underlying strength of the land market will prevent any further significant declines.

"I think a lot of producers over here have realised subsidies are eventually going to disappear and when that happens they will have to be bigger to survive. This means they are keen to buy land when it becomes available."

Traditionally, land has never been up for grabs in large quantities across the Irish Channel. Until the 1950s much of the republic was covered by huge estates, many owned by absentee Anglo-Irish landlords. The situation changed drastically when the Land Commission carved up vast tracts of land for redistribution to the sitting tenants at nominal amounts.

This has resulted in a patchwork of small family-owned units which rarely exceed 150 acres and come to the market very infrequently. Last year, the amount of land included in the Ganly Walters survey was less than 11,000 acres. This was influenced by the F&M outbreak, but even in the previous year the volume was only 15,300 acres.

"We have just launched around 6000 acres and that would be the biggest amount available for some time," says Mr Bain. And of that almost 4000 acres was a mountain with no agricultural value whatsoever, he adds.

But, even after their recent decline, Irish farm values are still some way ahead of those in the UK. Depending on location bare pastureland would make around k5000/acre (£3150), dairy land k7500/acre (£3725) and arable soil k5500 (£3500). Despite this, Mr Bain reckons buying land could be a good move for Britains producers.

"We have to put up with the same directives from Europe but Ireland is still very much rural-based. Most people are only one generation away from the land and the farmers here have a voice that the government has to listen to." &#42

Callum Bain says growth has slowed in Ireland.

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