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Rural Property Prices Ease in February


23 Mar 2005


Rural property prices began to ease during February despite stronger sales volumes, according to the latest rural sales figures from the Real Estate Institute of New Zealand.

Volumes were up both on January 2005 and on February 2004 especially in the three biggest sectors but prices eased, suggesting the previous tightness in the market had seen vendors accepting slightly lower prices to facilitate sales, according to the Vice President of the Real Estate Institute of New Zealand, Mr Murray Cleland.

The national rural median price for February 2005 was down to $1,030,000 compared with $1,131,250 in January, but was well up on the February 2004 median of $750,000.

Sales increased from 182 in January to 239 in February, comparable with February 2004 sales of 224 properties.

However Mr Cleland said that seasonally low turnovers were still a significant factor in price movements and the underlying rural market remained strong with a shortage of listings under-pinning the market and therefore prices.

“Turnovers at this time of the year remain pretty skinny, so it pays not to read too much into fluctuations in the median prices. Having said that, rising interest rates and the continued strength of the dollar may be beginning to affect rural confidence.”

The dairying median was down slightly from $2,200,000 in January to $2,125,000, but comfortably up on the February 2004 median of $1,808,550.  Dairying sales increased from 45 in January to 63 in February, also up on the February 2004 figure of 52.

Grazing property prices eased a little from $737,500 to $725,000 but again showed a good gain on the February 2004 median of $601,000.  Grazing sales increased to 101 from 82 in January, close to the February 2004 figure of 109.

Horticultural property prices eased from $1,025,000 in January to $925,000 in February, but the latest figure nevertheless illustrates the strong growth in horticultural property prices in the last year when compared with the February 2004 median of $580,000.

A similar pattern emerged with lifestyle properties with sales up from 559 in January to 709 in February, approaching the February 2004 figure of 775, but values eased.

The national lifestyle property median price eased from $320,000 in January to $300,500 in February, though still comfortably ahead of the $275,000 median recorded for February 2004.

However among the four largest regions three medians increased while Northland's median was down from $232,500 to $195,000.

By contrast the Auckland median was up from $520,000 to $550,000, the Waikato median was up from $292,000 to $345,000 and the Canterbury median was up from $227,390 to $239,500.

Mr Cleland said that most of the easing in the lifestyle market appeared to have taken place in the smaller provincial regions.

Download and read full press release: reinz-rural-report-feb-2005.pdf