The three months to October saw continued demand for rural property with more farms changing hands during the period, 582 compared with 557 in the three months to September 2007, the Real Estate Institute said today. More lifestyle properties also sold with 1,672 properties changing hands, up from 1,645.
While the national median price for both farms and lifestyle properties for the last three months to October was down slightly, REINZ says this reflects an increase in the number of smaller, lower priced holdings sold during the period.
The median selling price for farms remained steady at $1,305,000 compared with $1,320,000 to September. The lifestyle median eased slightly to $428,000 in October, compared with $435,000 in the three months to September.
According to REINZ National Councillor and rural spokesperson Mr Peter McDonald, “There is continued interest in good quality farms and lifestyle properties. With more properties about to come onto the market between now and Christmas, we expect a new level to be established particularly for dairy farms on the back of record milk fat payments and a lower dollar.
“The rural market has seen unprecedented gains over the past 12 months, with the median selling price for farms up 40 percent on the median price paid in the three months to October 2006.
“Twelve months ago, the median selling price for farms was $930,000 against the current median of $1,305,000. Over the past year, we’ve seen the median selling price for grazing properties go up by 38 percent to $1,100,000 and dairy farms by 22 percent to $2,639,000.
Mr McDonald said, “While the median for dairy properties in the three months to October was $2,639,000, down from $3,050,000 in September, these properties came onto the market before the most recent Fonterra announcement increasing the milk fat payout and so we can expect the price of dairy farms coming onto the market over the next few months to reflect the increased payout.”
53 dairy farms changed hands during the period; two more than in the three months to September.
The number of grazing properties, the largest single category of sales, mirrored this trend with 252 properties sold, up from 227, with a median selling price of $1,100,000, compared with $1,123,762 last month.
In other farm categories, the arable price moved from $1,624,000 in September to $1,640,000 in October but the finishing property median was down from $1,974,174 to $1,940,000. Sales of arable properties were down from 35 to 33 while the number of finishing properties increased slightly from 120 to 123.
Demand for horticulture properties continued to be buoyant with sales up from 50 in September to 51 in the latest period, but again the median price eased from $1,137,500 in September, to $1,085,000.
For lifestyle properties, demand and prices paid increased in both Auckland and Canterbury, the regions with the largest number of such properties sold. The median price in the Auckland region was up from $750,000 in September to $754,150 with 306 properties sold (302 in September). In Canterbury 265 properties sold, up from 256, and the median price increased from $352,500 to $366,000.
The national median for lifestyle properties remained steady at $428,000 in the three months to October compared with $435,000 in September.
“Demand for lifestyle properties tends to mirror the residential market, which is currently experiencing a period of consolidation,” Mr McDonald said.