Financing land purchase

digzy

I've a few quick questions,

Which institutions are providing loans?
What interest rates are available?
What would be a standard term?
what %age would you need saved up first?

kevthegaff

from what i hear acc have the best rates but lots of paper work as u may not be banking with them, i have to check out myself what i can get myself if anything came up around here

kerryjack

The most important thing banks like at the moment is turn over , they have very little interest in acids, its difficult at the minute to get a few a quid, its probably the biggest problem any business have of expanding I went in 3 years ago to a bank looking to buy a bit of land beside me i had big plans i was well equipped with all my acids between land and shares and they asked me what was my turn over, all my years of responsible banking counted for nothing ,the computer said no the figures did not add up.

viztopia

Was looking at this before Christmas. Rang acc and they said no chance given the age of my father. He is banking with boi so tried them. Very painful experience but I think that was down to the person in boi. Got an offer which was 6.79%. They were also looking for us to pay the banks legal fees which would be in the region of €3k. Went to aib and different story altogether. They has a regional agri manager who knows what hes doing. Gave a rate of 5.5% and legal fees of less than €2k. That interest rate difference makes a lot ot of difference on any kind of money over a period of time. I think it worked out at €7.5k on every €100k over 10 years.

delaval

Aib €800k over 20 yrs 50K/year
€800k over 15yrs 80k/year

st1979

delaval wrote: »

Aib €800k over 20 yrs 50K/year
€800k over 15yrs 80k/year

Your figures are wrong there as 20x50=1million
15x80=1.2million

I would assume it would be around 60k over 15yrs

delaval

st1979 wrote: »

Your figures are wrong there as 20x50=1million
15x80=1.2million

I would assume it would be around 60k over 15yrs

You are of course right my apologies. The correct quote was

€80k/thousand for 800k/20 yrs=64k/year
€100k/thousand for 800k/15 yrs=80k/year

This kind of mixup by myself is probably why my mother when she calls to see grandkids after half an hour of plesentries then asks to see the books. This is despite the fact that we have been running our own business for 15 yrs now. She also does the same to my 3 brothers. She is our own family auditor/alarm system:rolleyes::rolleyes::rolleyes:She is German:P:P

PatQfarmer

delaval wrote: »

You are of course right my apologies. The correct quote was

€80k/thousand for 800k/20 yrs=64k/year
€100k/thousand for 800k/15 yrs=80k/year

This kind of mixup by myself is probably why my mother when she calls to see grandkids after half an hour of plesentries then asks to see the books. This is despite the fact that we have been running our own business for 15 yrs now. She also does the same to my 3 brothers. She is our own family auditor/alarm system:rolleyes::rolleyes::rolleyes:She is German:P:P

Hard to justify land at current values and return at those payback rates...and I'm an Auctioneer!:D
With my part-time farmer hat on, it never ceases to amaze me the prices land makes. I know they "aren't making any more of it", but as a stand-alone investment, it just doesn't stack up. So new entrant farmers haven't a chance. You need to be farming a decent holding already (or have off-farm income) to have any chance of borrowing to buy. Even given the high rental prices of recent years, it is still "cheaper" on a cash-flow basis to lease land than to buy. Problem is security of tenure, but this has largely been addressed with the newer 5 and 7 year leases.

delaval

PatQfarmer wrote: »

Hard to justify land at current values and return at those payback rates...and I'm an Auctioneer!:D
With my part-time farmer hat on, it never ceases to amaze me the prices land makes. I know they "aren't making any more of it", but as a stand-alone investment, it just doesn't stack up. So new entrant farmers haven't a chance. You need to be farming a decent holding already (or have off-farm income) to have any chance of borrowing to buy. Even given the high rental prices of recent years, it is still "cheaper" on a cash-flow basis to lease land than to buy. Problem is security of tenure, but this has largely been addressed with the newer 5 and 7 year leases.

Pat, you'll put that on you website no doubt!!!!

delaval

PatQfarmer wrote: »

Hard to justify land at current values and return at those payback rates...and I'm an Auctioneer!:D
With my part-time farmer hat on, it never ceases to amaze me the prices land makes. I know they "aren't making any more of it", but as a stand-alone investment, it just doesn't stack up. So new entrant farmers haven't a chance. You need to be farming a decent holding already (or have off-farm income) to have any chance of borrowing to buy. Even given the high rental prices of recent years, it is still "cheaper" on a cash-flow basis to lease land than to buy. Problem is security of tenure, but this has largely been addressed with the newer 5 and 7 year leases.

No doubt that's on your website!!!!

PatQfarmer

delaval wrote: »

No doubt that's on your website!!!!

Laughing here:D
Facts are facts, no matter what way you cut them up.
Only way for anyone to expand without a large debt-free land bank atm is via leasing or off-farm income. ROI on land is nowhere near any other asset class, but they still keep buying it;)

Tipp Man

and if you never buy land - you'll never have land

keep going

Tipp Man wrote: »

and if you never buy land - you'll never have land

and if you buy land you will never have money:P

bbam

Be interesting to see how things pan out if there is a serious redistribution of SFP.
Allot of land bought in ye last while is relying on bloated SFP to make the payments. My sister works in lending to the Agri sector and the SFP income is still 100% being taken as sure income going forward.

They are being instructed to get money out against land with similar lending targets in place than during the boom years, just a different target market.