Dairy farm prices down in January, lifestyle block market buoyant - REINZ

The rural property market has a split personality, with dairy farm prices continuing to fall and other farm prices on the rise, according to the latest Real Estate Institute of New Zealand figures

The REINZ All Farm Price Index, which compares the prices of all farm types and adjusts for differences in farm size and location, was up 1.6% in the three months to January compared to the three months to December, and up 4.8% compared to January 2015.

However the number of farm sales was down, with 532 farming properties selling in the three months to January compared to 547 in the three months to December. Numbers were, however, up compared to a year earlier when 455 farms were sold in the three months ended January 2015.

Nine regions recorded increases in sales volumes compared to a year ago.

Recent rainfall had been beneficial for many farmers but had arrived too late for others, according to REINZ spokesman Brian Peacocke.

"Beneficial climatic conditions have resulted in good rainfall in some of the traditional sheep, beef and cropping areas which had been very dry, giving farmers in those areas a much need boost in confidence," he said.

"The flip side is that a number of farmers who had de-stocked in response to warnings of an El Nino event, now have insufficient stock to take advantage of the additional feed on hand."

Dairy farm prices fall

However while prices for most farm types were up, the REINZ Dairy Farm Price Index dropped another 1.2% in the three months to January compared to the three months to December and is now down 3.6% compared to a year ago.

There were 90 dairy farms sold in the three months ended January at a median price per hectare of $39,367, compared with 101 sales at a median price of $40,742 a year earlier.

The lifestyle block market remained buoyant, with 2109 lifestyle properties selling in the three months to January, slightly down on the 2277 that sold in the three months to December 2015 but up 30% on the 1623 sold in the three months to January last year.

There were 8285 lifestyle properties sold in the year to January which was up 29.1% on the previous 12 months.

The median price of lifestyle properties sold in the three months to January was $550,000, up 4% compared to a year earlier.

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