After what it describes as an "auspicious spring", PGW's general manager real estate, Peter Newbold says farmers and their bankers are taking a lead from good weather and market outlooks.
"Climatic conditions this spring have been favourable over the whole country, setting up what should be an excellent growing season. Projected income for the agriculture sector also looks positive," he notes.Newbold says some vendors have already capitalised on the competition for the limited number of farms for sale.
"For those looking to sell rural property in these advantageous conditions, selling by auction is a rational move. A number of those who have put property up for auction have enjoyed successful outcomes."
Highlights among PGW's sales this spring include:
• A Culverden dairy farm, sold at auction, setting a new North Canterbury record of $52,300/ha.
• A Wellsford dairy farm made $27,000/ha, the highest value recent sale for a Northland rural property.
• Premium Canterbury dairy farms selling $5000/ha above what similar properties made a year previously.
• Canterbury dairy grazing farms, with spray irrigation, trading between $40,000 and $45,000/ha
• Indicative dairy farm prices in North Otago of $30,000 to $46,000/ha.
• Benchmark prices for kiwifruit orchards twice what they were a year ago as the industry comes to terms with Psa.
• A 616ha Waipukurau hill country sale at auction for $4.46 million.
Newbold says that while market interest in medium size farms is strong throughout the country, buyers for larger farms are in shorter supply. However, he predicts that's likely to change as summer progresses.
"Some of the higher value sales recorded over the past few months were of smaller to mid-size properties. These are within the scope of farming families, while those of greater scale generally tend to sell to groups or partnerships of farmers or investors."
There's been a "slight shortfall in purchasers" for these larger properties but that may be short-lived, he believes.
"In addition to banks becoming more proactive, more large-scale local investors, including equity partnerships, are taking a new, or renewed interest in rural property, which is an important sign for the market, and should result in some premium sales at the higher end during the summer, most likely in North Otago, Mid Canterbury and Southland."
PGG Wrightson Real Estate says it is the market leader in rural property, responsible for approximately one in three sales of farm land.
