Rural property market consolidates, dairy farm sales hold

The rural property market is consolidating, with an increase in farm sales across the majority of regions in the three months ending February, new data shows.
The Real Estate Institute of New Zealand figures show there were 129 more farm sales, or nearly 40 per cent more, than there were in the same period last year. A total of 458 farm sales were recorded for the period, compared to 329 the year before.

Thirty per cent of sales in the three-month period were finishing farms, 30 per cent were grazing farms, while dairy accounted for 20 per cent and horticulture, 9 per cent.

There were 23 per cent more farms sold in the year ending February, than were sold in the same period the year before, with dairy farms representing the majority, or 51 per cent, of sales. A total of 1542 farms were sold in the year ending February.


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The median price per hectare for all farms sold in the three months to February was $25,665, compared to $20,569 for the same period last year.

For dairy farms the median price per hectare was $33,538; for finishing farms it was $35,718; for grazing farms it was $11,597 and for horticulture it was $355,547.

The REINZ All Farm Price Index increased by 7.4 per cent in the three months ending February compared to the same period last year.

The index adjusts for differences in farm size, location, and farming type, unlike the median price per hectare, which does not adjust for these factors.

Ten of the 14 regions recorded an increase in the number of farm sales for the three months ended February compared to the three months ended February last year, with the most notable being Waikato, up 27 sales, and Auckland, up 24 sales.

REINZ rural spokesman Brian Peacocke said the sales figures confirmed the rural market was in good shape, led by dairy farm sales and finishing and grazing properties.

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Fonterra's profits soared by 43 per cent in the six months to January.

Of particular note are the encouraging signals emerging from the world marketplace for dairy produce which in turn is being translated into an increasing payout to the dairy farmers. The increased cashflow from this sector alone will have significant benefits for the New Zealand economy.

Sales of finishing and grazing properties reflect the commitment from those sectors to explore every possibility in the marketplace in spite of serious supply chain issues, with the resultant increasing demand and sustainability of land values of properties within those sectors reflecting an underlying and seemingly sustainable degree of confidence.

Activity was also gearing up in horticulture with a bumper kiwifruit harvest underway supported by specialist reefer ships, he said.

However, the horticultural labour shortage was having a dramatic impact, with considerable amounts of export produce left unharvested, he said.

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