Buying land

6% plus

That’s a shocking rate. That’s nearly a personal loan rate. Did you have farm accounts in your own name befor or have previous record of paying off a loan or credit?

Example *A typical land loan of €60,000 over a term of 10 years with a variable interest rate of 5.50% (APR 5.65%), would mean that you would make 120 monthly repayments of €651.24. The cost of credit is €18,148.40 and the total amount repayable of €78,148.40.

[Warning – the above is provided for illustrative purposes only. This is a variable rate product and the interest rate can rise, which could increase the cost of your monthly repayments.]

Just googled and the above came up. I wonder is that webpage out of date?? As when I took out my loan it was about 5.5 but last 18 months flew up in interest.

Those rates will have to cool the market off. Unless there are enough bigger lads with company structure to keep pumping profits into land. Smaller blocks might come down a bit at least. From prices in the paper and advertised online it still seems to be soaring though!

Yep still 5%.

no obviously amount of interest is substantial lower now than the early years. Interetst is added on a quarterly basis.

You need to marry for love. Like Melania did.

But back on topic, what will happen if the arse falls out of milk price for a period? Global markets slump and then there are loads of lads with big loans with increasing interest rates betting ahead of them and then more being locked into expensive long-term leases at big prices.

I looked at a few places near me that went up for sale in the last 4-5 years. One I nearly bought (around 40 acres) but the owner decided to keep it in the end, and another place that was about 60 acres but the auctioneer was looking for about 20% more than I'd have been willing to pay (even considering it overpriced at that). It did sell. Land has been only on the up since.

And more on topic I agree alot lads including myself feeling the pain. Will be a tough year in farming as interest rates on the up and cost of stuff alot of lads will do zero investment for next few years.

That is why you were a one term President always with the negativity!

Bank of Ireland 6.07% secured, the latest I saw a few weeks ago, someone made the point here about the price of land in the media, there was two pieces not far from me late last year, within 1k of each other, one piece made €7000 an acre and the other €11000, both similar quality, the second lot made the paper but not a mention of the first, you never the lower prices

I started a thread on a similar topic a while back. I saw a story in the paper where a farm was hyped up in advance as expected to make 30k an acre. When the auction came and it made 23.5k an acre, it was then hyped up as a great price for the seller.

If I achieve a price that is only about three-quarters of what I said I was expecting to get, I wouldn't be hyping it up as a great sale price for me.

https://www.boards.ie/discussion/2058274802/why-do-journalists-all-hype-up-prices-for-things

The last few years you had non-farmers with a lot of money sitting in cash who thought "I'm getting 0% interest, and threatened with negative interest whereas if I buy farmland I can rent it out for a tax free income".

The current environment won't be seeing those people coming into it any more.

Places set up with a company structure which have a high level of income flowing in due to high prices will still be looking for somewhere to put that money. Thar income stream is far from guaranteed though.

Land price also depends on infrastructure. A decent road into and through the farm is worth 1-1.5k/ acre. At present fertility of land could be worth the same. Fencing and water 1k/ acre. A decent shed 1-2k/ acre

Last year a farm made 20k/ acre the other side of Limerick. However it was a working farm with a residence. All you had to do was pull up the truck and unload the cows and start milking.

Roadways and fencing are. But the overall limit is 90k this limits you if you have other investments. This is an issue with dairy farmers who hit that limit very fast.