Farm sales flat year-on-year, average price down

A total of 81 farms sold across the country last month including just six dairy farms, figures from the Real Estate Institute of New Zealand’s latest Rural Market Report show.

That compares to 118 sales in May, 80 in June 2009 and 216 back in June 2008.

The six dairy farms sold is less than half the 13 sales recorded in both May this year and June last year, but is up on the record low of zero sales last August. The average price across the six dairy farm sales was NZ$3,389,167 with the average price per hectare down to NZ$32,033 from NZ$39,653 in May. The average price per kilogram of milk solids slipped to NZ$40 in June from NZ$45 in May.

REINZ said 302 farms were sold in the three months to the end of June, up from 285 in the same period of last year but less than half the 711 sold in the three months to June 2008 or the 665 sold in the same period of 2007.

The national median farm sale price was steady at NZ$1,035,000 in the three months to June, but is down from NZ$1,155,000 in the three months to June 2009 and well off the NZ$1,805,000 in the same period of 2008.

“On a regional basis the largest number of farm sales during the three months to June was 45 in Canterbury and 39 in the Bay of Plenty,” REINZ said.

“But in the same period in 2008 the number of farm sales totalled 132 in Canterbury. In the Waikato total farm sales have fallen from 99 in the three months to June 2008 to just 32 in the same period this year.”

Less farm sales and lower prices come as the banks tighten the lending screws. According to Reserve Bank figures, NZ$47 million was lent to the agricultural sector in May. That's down 3.3% from April, with the figures flat or falling since the middle of last year.

Over the last year median farm prices have fallen in 11 of 14 districts.

REINZ said in the three months to June, compared to the same period of 2009, farm sale prices fell in Northland to NZ$702,500 from NZ$900,000, Auckland to NZ$790,500 from NZ$892,500, Waikato to NZ$1,332,000 from NZ$2,000,000, Bay of Plenty to NZ$1,035,000 from NZ$1,225,000, Hawkes Bay to NZ$790,000 from NZ$841,875, Welllington to NZ$1,775,000 from $2,450,000, Nelson to NZ$596,700 from NZ$625,000, the West Coast to NZ$455,000 from NZ$2,900,000, Canterbury to $NZ1,250,000 from NZ$1,260,000, Otago to NZ$565,000 from NZ$1,240,500 and Southland to NZ$1,100,000 from NZ$1,175,000.

A total of 1,113 lifestyle properties were sold in the three months to June. The national median selling price of NZ$455,000 was up from NZ$421,250 in June last year.

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