The price of agricultural land dropped by 6% last year, according to the latest review from the Society of Chartered Surveyors Ireland and Teagasc.
The average price for an acre of land nationally was €8,823 in 2019, down from €9,346 in 2018.
Munster recorded the biggest yearly fall in selling price at 9%, while selling prices fell 6% in Leinster and just 1% in Connacht/Ulster last year.
The survey also reveals that the average price per acre without a residence last year in Leinster was €10,224 an acre, with Munster on €9,719 and Connacht/Ulster on €6,527.
The survey of 163 chartered surveyors from all over the country was conducted in December and early January 2020, before the outbreak of Covid-19.
Miah McGrath, Chair of the SCSI’s Rural Agency Group, said the report’s findings reflected the fall in farm output prices and increased demand from farmers to lease land.
Mr McGrath cautioned that Covid-19 remained the great unknown in terms of developments this year.
“The sudden emergence of the Covid-19 crisis and the speed at which it has moved has created a negative demand shock for farming, ” he said.
Noting that while consumption of food within the home has increased, he said this has been more than offset by reduced consumption outside the home. Meat and dairy commodity prices have fallen as a result.
“The short-term economic impact is likely to be quite negative, but the effect on land prices will probably depend on the duration of the crisis and this makes it very difficult to predict future price moves,” he added.
Miah McGrath said that up to this Brexit had been a major concern for farmers with 74% of SCSI members believed fears over Brexit deterred buyers, while 63% believed it deterred sellers.
He said that given the negative economic effect Covid-19 will have, the importance of the EU and the UK agreeing a trade deal this year, is now more important than ever.
“Purchaser confidence is likely to remain weak until more clarity on both issues emerges,” he added.
This year’s report includes a long-term price series for land sales and land rental prices which has never previously been publicly available.
The data, from Smith Harrington, shows that over the last 50 years the price of an acre varied from a low of €290 in 1970 to a high of over €20,000 in 2007 at the height of the Celtic Tiger.
Prices then fell to between €9,000 to €10,000 in recent years.