Buyers hunting for right farm
It could be that buyers are hunting out the right farm to purchase as farm sales drop for the three months ended December 2023. That’s according to the Real Estate Institute of New Zealand (REINZ).
Data released this week by the Real Estate Institute of New Zealand (REINZ) shows there were 256 fewer farm sales for the three months ended December 2021 than for the three months ended December 2020.
Overall there were 293 farm sales in the three months ended December 2021, compared to 361 farm sales for the three months ended November 2021, and 549 farm sales for the three months ended December 2021.
“Sales figures for the three-month period ending December 2021 reflected an easing in volumes compared to similar periods over the last three years, with all categories being impacted,” says Brian Peacocke, rural spokesman at REINZ.
“Logic would suggest that due to the very strong forecast for the dairy payout for the 2021-2022 season, and particularly strong prices for beef, lamb and horticultural products, fewer rural properties have been available for sale as landowners, as would be expected, have retained properties in order to capitalise on the current high product returns.”
However, despite this, the total volume of farm sales for 2021 increased considerably from 2020.
Peacocke says this reinforces the strong demand for continued investment in rural land.
“On a balancing note however, whilst the banking sector is currently more amenable to backing soundly structured lending proposals, the inexorable grind of increasing costs, the shortage of quality labour and supply chain difficulties are well recognised constraints that continue to challenge the rural industry,” he concludes.
1,831 farms were sold in the year to December 2021, 235 more than were sold in the year to December 2020, with 84% more dairy farms, 23.1% less dairy support, 7% more grazing farms, 10% more finishing farms and 14.7% less arable farms sold over the same period.
The median price per hectare for all farms sold in the three months to December 2021 was $37,980 compared to $27,320 recorded for three months ended December 2020.
The median price per hectare increased 0.7% compared to November 2021.
The REINZ All Farm Price Index increased 2.8% in the three months to December 2021 compared to the three months to November 2021.
Compared to the three months ending December 2020 the REINZ All Farm Price Index increased 21.8%.
Only the Otago region recorded an increase in the number of farm sales for the three months ended December 2021 compared to the three months ended December 2020.
Manawatu-Whanganui and Waikato recorded the biggest decreases in sales, down 46 sales and 45 sales respectively.
Compared to the three months ended November 2021, no regions recorded an increase in sales.
