Farm Prices Climb Higher

RURAL median prices have risen by 41.7% from a year ago according to the latest Real Estate Institute of New Zealand rural market report.

In Taranaki, the median farm price reached $1,350,000 in July up from $1,250,000 in June and $1,325,500 a year ago.

Strong dairying prices and returns played a big part in the July figures, REINZ national councillor and rural spokesperson for the Institute Peter McDonald said.

“The dairy median was up again to $4,200,000 for the three months to July, compared with the median of $4,025,000 for the three months to June, even though dairy farm sales are now entering the quieter period,” Mr McDonald said.

“Demand for dairy farms continues to exceed supply and milk solid prices are underwriting the sector’s confidence, with the falling dollar contributing to the positive outlook for dairying and indeed farming as a whole,” Mr McDonald said.

He said some dairy farms were fetching historically high prices with one property in July changing hands for $20 million. The farm, near Huntly, was sold as a going concern and is believed to have set a new Waikato record.

However, even though prices were higher, sales throughout the country were down to 601 in the three months to July from 711 to June and July’s 2007 figure of 669.

Among the other sectors the finishing property median was slower at $2,240,000 to July compared with $2,350,000 to June. Sales for these were down from 137 to June to 125 to July.

Grazing properties were in good demand with the median price rising from $1,440,000 to June to $1,500,000 for the three months to July.

Sales were down from 325 to June to 278.

Having previously looked resilient, the lifestyle property market showed signs of weakening in this latest period.

The median lifestyle price was down from $455,000 to June to $450,000 to July, however this is still ahead of the $445,750 median price of a year ago.

Lifestyle property sales started to mimic the trend of the residential property market, with sales to July down to 1,105, compared with 1,177 to June and 1,898 a year ago.

In Taranaki 52 lifestyle blocks sold in July, up on the 49 sold in June and down on the 72 sold in July 2007.

The median price also rose to $427,500, up from $410,000 in June and July 2007 of $330,000.

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