Farms for sale NZ: Data released today by the Real Estate Institute of New Zealand (REINZ) show that farm sales had dropped by 20% (81 fewer farm sales) for the quarter ending June 2022 than there had been for a similar quarter in June 2021.
For the period there were 325 farm sales compared to 412 farm sales for the three months ended May 2022. There were 9.5% more Dairy farms, 32.8% fewer Dairy Support, 21.7% fewer Grazing farms, 10.2% fewer Finishing farms and 12.7% fewer Arable farms sold over the same period.
The median price per hectare for all farms sold in this quarter was $28,040 compared to $27,180 recorded for the previous quarter last year (+3.2%). The median price per hectare decreased by 6% compared to the previous quarter.
The REINZ All Farm Price Index increased 0.1% in this quarter compared to the previous quarter. Compared to the same quarter in June 2021 the REINZ All Farm Price Index increased an impressive 28.9%.
The REINZ All Farm Price Index adjusts for differences in farm size, location, and farming type, unlike the median price per hectare, which does not adjust for these factors. Four regions recorded an increase in the number of farms for sale for the quarter compared to the same quarter in 2021, with the most notable being Southland (+8 sales) and Manawatu-Whanganui (+5 sales). Northland (-19 sales) and Gisborne/Hawke’s Bay (-18 sales) recorded the biggest decreases in sales.
Brian Peacocke, Rural Spokesman, at REINZ says: “As is the normal pattern for this time of the year, the onset of winter and the changeover date for dairy farms traditionally impacts total sales volumes throughout the country.
He says, “Interestingly enough, the result for the three months ending June 2022 (325 sales) reflects a decrease of 17.5% from the three months ending June 2021 (406 sales 12 months ago), whereas the most recent result for June 2022 (325 sales) compared to the same period ending June 2020 (255 sales 2 years ago) reflects an increase of 21.5%, so the current result still reflects a reasonably solid market.
Mr Peacocke says, “Dairy farm sales are down 20% from the equivalent period 12 months ago, but double the number achieved for the June quarter in 2020, two years ago. By comparison, sales numbers of finishing units for the June quarter just finished compared to the June quarter 12 months ago are similar but have increased by 62% from the volumes achieved two years ago. That reflects a substantial lift last year which is being maintained this year.”
Peacocke adds, “Sales of grazing blocks reflect a 30% decrease for the comparable period 12 months ago, but a gain of 27.5% compared to two years ago. Horticulture sales have eased 37% and 24% for the respective periods referred to above, so in percentage terms, albeit the volumes are not high, current conditions have impacted that sector to a greater extent than has been the case with the other sectors.”
With the high Official Cash Rate and inflation hovering around 7%, it is expected that real estate and farm sales will struggle and the rural outlook is cautious.
Points of interest around the country during June include the following: Northland/Auckland Northland results reflected sales in most categories but the number of sales of finishing and grazing properties was considerably lower than the results achieved during June over the last two years. By comparison, Auckland’s results were consistent with recent years, albeit low, with a small number of sales of finishing properties and the Rodney and Franklin districts.
The central Waikato region figures reflect a reduced number of sales of finishing, grazing, dairy and dairy support properties compared to recent months, but remained reasonably consistent with comparable periods over the last three seasons.
The Northern King County registered light results in the finishing and grazing categories with Taranaki Sufficient sales activity during June to register, with one sale in each of the dairy, dairy support, finishing, grazing and forestry categories.
Manawatu/Whanganui/Tararua had very light results in the Manawatu region with a single finishing property sold; unusually, two good forestry blocks sold in the Whanganui district, whereas ever-consistent Tararua again had a good month, with sales in the finishing, grazing and dairy support categories, albeit still not quite as strong as the same period in each of the last two years.
Wairarapa/Wellington had a quiet time in the southern sector of the North Island with no farm sales recorded.
For this quarter, the median sales price per hectare for dairy farms was $36,755 (46 properties), compared to $37,060 (75 properties) for the previous quarter. The median price per hectare for dairy farms has increased 4.1% over the past 12 months. The median dairy farm size for the quarter was 98 hectares.
On a price per kilo of milk solids basis, the median sales price was $35.94 per kg of milk solids for the quarter compared to $34.81 per kg of milk solids for the previous quarter.
The REINZ Dairy Farm Price Index increased 3.3% for the quarter compared to the previous quarter. Compared to June 2021, the REINZ Dairy Farm Price Index increased by 11.5%. The REINZ Dairy Farm Price Index adjusts for differences in farm size and location compared to the median price per hectare, which does not adjust for these factors.
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