Rural land values avoid market drop
A Co Antrim auctioneer has said that agricultural land in rural Northern Ireland is continuing to hold its value despite the plunge in house and site values.
Estate agent Danny McAlister was speaking after selling two relatively small plots of land on the north coast for a total of just over £450,000.
Some of the land worked out at almost £19,000 an acre.
His comments follow a report which revealed that agricultural land values in Britain climbed to a record in the first half of 2011 as higher livestock and grain prices encouraged farmers to increase production.
The Royal Institution of Chartered Surveyors said that the average cost of an acre of bare land rose to £6,115 from £5,846 at the end of 2010.
The organisation also said that prices have more than doubled in the last five years and that arable land appreciated by 4.9% and pastures by 4.2% an acre since the end of last year.
The RICS report showed that both the number of transactions and acreage sold fell, while brokers said that demand for agricultural land is also being driven by investors seeking a refuge from turbulence in global financial markets.
Meanwhile in the Republic it has emerged that the land portfolio of 'bad bank' Nama contains 24 land packages classified as agricultural land.
Land accounts for 18% of the assets now owned by Nama.
Thousands of acres of land across Ireland, north and south, Britain and parts of Europe, for which Nama paid millions, are set to return to agricultural production. One receiver is said to be handling 400-500 acres of land in Cork alone, with farmers keen to see land zoned for development put back to use in animal and crop production.
Mr McAlister, of Daniel McAlister & Son, said that in certain areas, supply and demand was keeping prices high.
"In certain areas like on the north coast, small farms are kept in the family for generations and only come on the market very rarely, so when they do finally come up for sale the interest is high," he said.
"Land, especially good land, is at a premium as there are certain areas of the coast that are not easy to farm on.
"There is a similar situation in Scotland, where prices are effectively doubling for agricultural land.
"While there has been a drop in the price of houses and development sites, farmers tend to hang onto their land and it can be a good investment for those who have the money to spend."