Agricultural land prices surged by as much as a third in the last two years, according to an analysis of values carried out by the Irish Farmers Journal.
At €11,966 on average per acre, land prices in 2021 reached their highest level since the financial crash of 2008.
That amounted to an increase of €1,650 per acre - or 16% - on 2020 prices.
However, when compared to 2019, values were up 33%, the study concludes.
In Northern Ireland, land values soared to their highest on record with the price per acre reaching £11,444 - an increase of 14% on 2020.
A general shortage of land for sale, low returns on deposits and other forms of investment and the desire to purchase land to offset carbon were among the main drivers of land prices in recent years, the study concluded.
The latter is a very recent area of demand and accounted for a small but growing category of buyer.
"The number of these transactions was small at about a dozen. But auctioneers in every county received phone enquiries," the study noted.
The return of auctions
While auctions returned in 2021 after being curtailed by pandemic restrictions, private treaty remained the more popular route to sale.
Of the 803 holdings offered for sale last year, 299 or 37% were offered by auction, and 501 or 62% were offered by private treaty.
The most significant increases in land prices were seen in Clare, Dublin, Leitrim, Westmeath and Monaghan, the report noted.
Average farmland price fell in five counties - Donegal, Kildare, Longford, Mayo and Waterford.
The lowest average price was in Mayo at €4,813 per acre.
Business people were particularly active in the market in 2021 accounting for around 40% of farmland sold.
That category is defined as buyers with non-farming income and includes part time farmers, business people with an interest in farming and other investors not connected with farming.
"We saw individuals with successful businesses buy farmland. In many cases, this was to farm it themselves, but other individuals were motivated to buy land because money in the bank was generating little interest or was subject to negative interest," the report noted.
"We also saw a small number of non-farmer investors, buy land with the specific intention of leasing it to an active farmer and availing of tax relief on the lease income," it added.