The rural property market finished summer on a downbeat note, with both the volume of farms sold and the prices achieved being down compared to a year ago.
The Real Estate Institute of NZ recorded 281 farm sales in the three months to the end of March, down 15.1% compared to the same period of last year.
The dairy sector was the hardest hit, with dairy farm sales down by 32.6%, followed by finishing farms -26.1%, grazing farms -14.3% and arable farms -14.1%.
Farm prices were also softer, with the REINZ All Farms Price Index, which adjusts for differences in the mix of farms sold by type, size and location, down 12.8% in the three months to March compared to the same period of last year.
The REINZ Dairy Farm Price Index, which also adjusts for differences in the mix of farms sold by size and location, was down 13.0% in the three months to March compared to the same period of last year.
REINZ rural spokesperson Brian Peacocke said the rural sector remained in good heart in spite of the challenges it faced.
"Whilst being heavily impacted and abiding by the same rules applying to the broader population, rural NZ, by virtue of being declared an essential industry, has had the necessary benefit of freedom of movement within their specific properties and general workplaces, more so than has been the case for their urban cousins," Peacocke said.
"Widespread drought conditions of recent months aside, morale within the rural community in general terms appears to be good," he said.
"This mood will be significantly enhanced if the banking sector, aided by a relaxation of Reserve Bank criteria for the building of capital reserves, adopts a more pragmatic and empathetic approach towards their rural clientele.
"One of the unfortunate consequences of the rules governing those sectors deemed essential industries, particularly the meat industry, is that it would appear processing costs will increase significantly, possibly by 25% for lamb and at this stage, by an undisclosed percentage increase in the killing charges for cattle.
"At a time when border restrictions are placing world market access for NZ exports under pressure, such increases will have a detrimental impact on incomes within the wider primary industry, to an extent which is yet to be determined," Peacocke said.
A more detailed, month-by-month breakdown of farm sales is available here.
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