Harkin TD welcomes easing of planning regulations for one-off houses

by john mc dermott - R.F.F.P.(Remove Fianna Fail Party Sat Jan 10, 2004 14:48 jmcd33 at eircom dot net Ashtown Dublin 15

Fianna Fail have made a shambles of our capital,now their Gombeen ,populist-policy makers in Sligo /Leitrim(and the rest of Ireland)..sally forth to rural pastures to destroy the environment and the countryside ,...for future generations.What a wonderful legacy of despoilation and corruption for our childrens children.Greed it seems is the new God ..among our rural landowners/and fatly subsidised farmers.

Unchecked Land Prices Will Make Irish Agri-business Uncompetitive


Between 1997 and 2002 the price of Irish agricultural land more than doubled. The price of an average acre – €2,800 in 1997 – stood at €5,700 by March 2002. Land prices continued to rise during 2002 - up another 6% to €6,043 per acre by September of the same year.

But 2002 saw lower prices for agri-produce and smaller farm incomes. In the twelve months ending December 2002 the value of farm outputs fell by 5%, the cost of inputs continued to go up – and the result was an 8.5% drop in farm incomes.

Why are land prices rising while commodity prices fall? And more importantly – what implications does this contradiction have for Irish agri-business?

According to Dr Nicholas Bielenberg of the Irish Landowners Association high land prices are the result of "non-agricultural forces". There is a considerable amount of data to back up Dr Bielenberg’s view.

The price of land rose fastest in the years of greatest economic growth. The late 90’s saw huge leaps (25% in 1999 alone) with the increases tapering off since then (14% during 2000, 9% in 2001).

Non-agricultural forces, or - more specifically - non-agricultural selling points, have gained prominence in advertising the sale of farmland. Adverts rarely feature a farm for sale without drawing attention to "extensive road frontage" or "excellent site potential". The suggestion is that, in the right hands, the break-up value of farms is greater than their worth as going concerns. In short, dabble in the property market and the parts of a farm can realise more than their sum.

The above probably explains why land is being sold in ever-smaller lots. Between 1998 and 2002 transaction size almost halved. In late 1998 the average transaction comprised 46 acres. By September 2002 it had fallen to 24 acres. This is despite the fact that both the 1998 and 2002 figures exclude sales involving less than 5 acres.

The price of land is rising fastest in areas where the demand for urban-generated housing is strongest. One to two hours commute from Dublin - in Kildare, Meath, Wicklow and the Midland counties - land values rose approximately 115% between 1997 and 2001. Contrast this with the southeast where the increase over the same period was a more modest 57%.

Perhaps the most striking table in the latest report produced by the Central Statistics Office (available on www.cso.ie) is land price in Ireland compared to other EU countries. It shows that between 1997 and 2001 the price of land in Ireland leapfrogged that of Denmark and Germany and rose significant further ahead that of Scotland (see chart). The figures for the other states are due to be updated soon. When released, they are expected to show that while land prices in major competitor countries have gone up, the rise is not anywhere near as steep as Ireland.

Essentially, the price of Irish agricultural land appears to be tracking the housing market, not agri-business. If a farmer outbids property interests to secure a plot of land he then burdens himself with repayments appropriate to a much more lucrative market. The upshot for Irish farmers – if this situation persists – is the frustration of enterprise, a loss of competitiveness, and reduced market share. The Agricultural Consultants Association has already noted that overpriced land is thwarting dedicated farmers.

A vital question is how each of Ireland’s 88 local authorities will interpret the National Spatial Strategy’s approach to rural housing. The NSS insists that key assets in rural areas must be protected. While it allows for some variation due to land quality, the general principle is that rural housing policy should be reflective of rural need.

Arguably, the greatest rural need is to avoid a situation where Irish agri-produce is priced off European shelves. If this analysis is accepted then local authorities will tend to restrict new rural housing to those engaged - or going to be engaged - in agri-business.

One way to do this would be to insist that a planning application for a new house in the countryside is accompanied by a business plan. The business plan would set out the applicant’s commitment to farming. A subsequent failure to follow the plan would result in financial penalties to encourage a sale to someone who was going to farm.

Such a measure would mirror the situation in the Netherlands where new rural housing is effectively confined to farmers. A policy of preserving farmland for farming is also found in Bavaria, Germany – and this is despite the fact that average farm size is significantly smaller than Ireland. The UK, in 2001, saw fewer new houses constructed in the countryside than in Ireland – even though its population is twenty times greater.

In Belgium, rules tightening so-called "scattergun housing" are relatively recent. Concern over losing 2 – 3% of its land area each year through de-urbanisation lay behind the reform.

In terms of allowing the countryside to become suburbanised Ireland and Finland are probably the most lax countries in northern Europe. There is little sign that Finland will bring in restrictions.

But then Finland isn’t a significant player in EU agri-business. Ireland, if it fails to grapple with the forces affecting land prices, is heading in the same direction.


3 May 2003