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REINZ reports a number of farm owners are holding off selling till the weather gets better; lifestyle market sales squeezed

REINZ reports a number of farm owners are holding off selling till the weather gets better; lifestyle market sales squeezed

The Real Estate Institute's reporting that the soggy Spring weather is prompting a lot of would-be farm sellers to hold off marketing their properties.

The REINZ's rural spokesperson Brian Peacocke said while a number of properties were programmed to come onto the market during the current Spring, in some areas of the North Island in particular, extremely wet, unpleasant conditions had caused some vendors to delay their marketing programmes until their properties were more "presentable”".

"The net result of this delay is a greater number of farms have been marketed, by whatever the chosen method of sale, within a timeframe to conclude in November and December.  An urgent need for more sunshine is the dominant factor in many regions."

The median price per hectare for all farms sold in the three months to October 2016 was $25,974 compared with $27,579 recorded for three months ended October 2015 (-5.8%).  The median price per hectare fell 3.2% compared with September. 

The REINZ All Farm Price Index fell 2.8% in the three months to October 2016 compared with the three months to September.  Compared with October 2015 the REINZ All Farm Price Index rose 5.9%.  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.

REINZ also reported there were 52 more lifestyle property sales (+2.5%) for the three months ended October 2016 than for the three months ended October 2015.  Overall, there were 2,175 lifestyle property sales in the three months ended October 2016, compared to 2,230 lifestyle property sales for the three months ended September 2016 (-2.5%), and 2,123 lifestyle property sales for the three months ended October 2015.

Some 9,115 sales of lifestyle properties were reported in the year to October 2016, 17% more than were sold in the year to October 2015.  The value of lifestyle properties sold was $6.91 billion for the year to October 2016.

The median price for all lifestyle properties sold in the three months to October 2016 was $20,000 higher at $545,000 compared with the three months ended October 2015 (+3.8%).  The median price rose $15,000 (+2.8%) compared with September.  

"Sales volumes in the lifestyle market for the three month period ending October 2016 remain strong but reflect a consistent easing over the last several months.  Variable conditions are influencing the market but a shortage of supply is a constant theme, the net result being pressure on prices," Peacocke said.

Nine regions recorded an increase in lifestyle sales compared to October 2015.  Wellington recorded the largest increase in sales (+60) in the three months to October 2016 compared with October 2015, Northland saw an increase of 44 sales and Manawatu/Wanganui an increase of 37 sales.  Compared with September 2016, four regions recorded an increase in sales.  Compared with October 2015 the number of sales for the three months to October 2016 rose by 52 sales.

The median price for lifestyle blocks in Auckland rose by $135,000 (+13.0%) from $1,035,000 for the three months to October 2015 to $1,170,000 for the three months to October 2016.  Over the same time period, the median price rose by 31.9% in Waikato to a new record of $620,000, and rose by 5.5% to $612,000 for Canterbury.

Back on farm sales; REINZ said there were five fewer farm sales (-1.4%) for the three months ended October 2016 than for the three months ended October 2015.  Overall, there were 353 farm sales in the three months ended October 2016, compared with 388 farm sales for the three months ended September 2016 (-9.0%), and 358 farm sales for the three months ended October 2015.  There were 1,760 farms sold in the year to October 2016, 1.7% more than were sold in the year to October 2015, with 26% fewer dairy farms and 6% fewer grazing farms sold over the same period.

More details are here.

Five regions recorded increases in sales volume for the three months ended October 2016 compared with the three months ended October 2015.  Otago recorded the largest increase in sales (+13 sales), followed by Northland (+11 sales), and Southland five sales. Compared with the three months ended September 2016, four regions recorded an increase in sales.

Grazing properties accounted for the largest number of sales with a 41% share of all sales over the three months to October 2016, Horticulture properties accounted for 18%, Finishing properties accounted for 20% and Arable properties accounted for 9% of all sales.  These four property types accounted for 88% of all sales during the three months ended October 2016.

Dairy Farms

For the three months ended October 2016 the median sales price per hectare for dairy farms was $40,716 (17 properties), compared with $33,132 for the three months ended September 2016 (12 properties), and $31,552 (18 properties) for the three months ended October 2015.  The median price per hectare for dairy farms has risen 29% over the past 12 months.  The median dairy farm size for the three months ended October 2016 was 108 hectares.

On a price per kilo of milk solids basis the median sales price was $34.64 per kg of milk solids for the three months ended October 2016, compared with $43.05 per kg of milk solids for the three months ended September 2016 (-19.5%), and $34.99 per kg of milk solids for the three months ended October 2015 (-1.0%).

The REINZ Dairy Farm Price Index fell 18.1% in the three months to October 2016 compared with the three months to September.  Compared with October 2015, the REINZ Dairy Farm Price Index fell 8.7%.  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.  REINZ says care needs to be taken during the winter months as the low level of sales (17 for the three months to October) can distort the Index figures.

Finishing Farms

For the three months ended October 2016 the median sale price per hectare for finishing farms was $26,834 (72 properties), compared with $26,834 for the three months ended September 2016 (74 properties), and $25,333 (67 properties) for the three months ended October 2015.  The median price per hectare for finishing farms has risen 5.9% over the past 12 months.  The median finishing farm size for the three months ended October 2016 was 36 hectares.

Grazing Farms

For the three months ended October 2016 the median sales price per hectare for grazing farms was $15,242 (143 properties) compared with $15,339 for the three months ended September 2016 (158 properties), and $19,253 (153 properties) for the three months ended October 2015.  The median price per hectare for grazing farms has fallen 20.8% over the past 12 months.  The median grazing farm size for the three months ended October 2016 was 52 hectares.

Horticulture Farms

For the three months ended October 2016 the median sales price per hectare for horticulture farms was $182,584 (65 properties) compared with $177,726 (82 properties) for the three months ended September 2016, and $171,482 (68 properties) for the three months ended October 2015.  The median price per hectare for horticulture farms has risen 6.5% over the past 12 months.  The median horticulture farm size for the three months ended October 2016 was eight hectares.

Farm sales

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New Zealand
Source: REINZ
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Arable
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Dairy
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Finishing
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Forestry
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Grazing
Source: REINZ
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Horticulture
Source: REINZ

 

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