Plenty of farms for sale in New Zealand

In contrast to the scarcity of land for sale in the UK, the number of farms sold in New Zealand in the year to October rose by 15.6% to 1,629 holdings.

The national Real Estate Institute of New Zealand (REINZ) farmland index fell 4% in the three months to October, with mid-range farmland prices settling at about £5,051/acre across all farm types.

The index shows a fall in values of 4.1% for the three months ended in October this year, but a 7.4% rise over the year to the same date. “Reports around NZ indicate a variable market ranging from active and strong to patchy and quirky,” said REINZ rural spokesman Brian Peacocke.

As in the UK, good properties are selling well but discerning buyers and careful bankers mean that sellers’ expectations of price rises are meeting some resistance.

Overall, prices are still well below the peak seen in mid-October 2008, after which a rise in interest rates caused land prices to fall.

Almost 90% of all sales in the year to the end of October were accounted for by four farm types – grazing (45%), finishing (20.3%), horticulture (11.5%), and dairy (10.6%).

The REINZ dairy farm index shows a compound annual growth rate of just over 5% over the past 10 years, but a fall of 8% over the past five years. The dairy index is 2.3% down on its level a year ago.

The number of lifestyle property sales jumped by almost 17%, with this type of property taking an average of 73 days to sell.

New Zealand – agriculture’s importance

• Agriculture, food and forestry generate 64% of NZ’s merchandise export earnings and around 12% of GDP
  
• World’s largest dairy exporter – 95% of dairy production exported
  
• Accounts for 38% of world dairy trade – most influential and growing market is China
  
• World’s largest exporter of sheepmeat
  
• Also exports large volumes of beef and wool