'Blended' auctions here to stay says prominent Limerick auctioneer
ALL COVID restrictions might be lifting but “blended” land auctions are here to stay, believes Limerick auctioneer Tom Crosse.
At last month’s IPAV's Farming Report 2022 virtual launch and webinar, GVM’s group property director touched on the new phenomenon of selling farms in person and online.
It is as easy for a person to purchase the “lot” at the physical auction as it is by somebody on their laptop in another country.
A perfect example is after one auction last year, Mr Crosse invited the successful bidder to go for a drink with the vendor and himself.
“He said, ‘No, Tom. I can’t. I'm on my boat in Spain'. He was bidding while on his boat,” said Mr Crosse.
An interesting point he made during his address is that people are now able to bid anonymously without the fear of upsetting a neighbour or maybe a long-term tenant.
“There might have been a reluctance among others to bid against them at auctions or participate in a bidding process. The online system gives them anonymity and they can do their business without anybody knowing who is bidding
“From an agent’s viewpoint it also takes the mystery out of it about how many bidders we may have. Deposits are paid in advance and all live bidders have to register. It’s a great system,” said Mr Crosse.
Those who like to see the whites of their competitors' eyes can still do that too. He had an auction recently in Shanagolden where there were no online buyers.
“I think it's a much better system doing it blended rather than a full online system,” said Mr Crosse, who agrees that it may have contributed a little bit to price increases.
In 2021, GVM oversaw around 1,000 acres changing hands for €15m. The stand-out lot was arguably 79 acres at Kilpeacon, Crecora, where the National Ploughing Championships were held in 1991. An online bidder won the day at €1,420,000 or €17,974 an acre.
“We would have been saying €10,000 an acre but that would have gone up 20% in the last 12 to 18 months and for good land we are thinking more along the lines of €15,000 an acre.
“It's all across the board really. For bad land, it was €6,000 an acre, that’s gone up to €8,000 or €9,000. There isn't too much land now that isn't making €10k an acre,” said Mr Crosse.
The prices achieved encouraged people considering selling to pick up the phone to auctioneers.
“Demand is very strong, driven mainly by dairy farmers and the returning to the market of business people buying land for investment. For example, I put some land on the market in December, which would be very, very unusual for us,” said Mr Crosse.
Another trend he has seen is the return of some Kerry farmers to the market in Limerick.
“They may have been boosted by some share conversions last year that would have increased their financial ability to buy land. They were a little bit absent in previous years but they are back out again buying,” said Mr Crosse.
Looking to the future, he says the outlook for farming appears positive which should ensure strong demand for selling and letting into the foreseeable future.
“Banks are amenable to lending into the agricultural sector which also should underpin demand,” concluded Mr Crosse.