Days to the General Election: 37
See Party Policies here. Party Lists here.

Steady demand for good quality rural properties but less interest in lesser quality farms - REINZ

Steady demand for good quality rural properties but less interest in lesser quality farms - REINZ

Farm prices rose in the December quarter compared to the same period of 2015 although the number of sales was down.

The latest Real Estate Institute of NZ figures show that 499 farms were sold in the three months to December, down 8.8% compared to the same quarter of 2015, while the REINZ's All Farm Price Index, which adjusts for differences in farm size, location and type, was up 4% compared to a year earlier.

The median price per hectare of all farms sold in the three months to December was $27,774 which was down 1.2% compared to a year earlier.

In the dairy sector, 72 dairy farms were sold in the three months to December which was down 16.3% compared to a year earlier, while the REINZ Dairy Farm Price Index was up 1.9% compared to December 2015.

"Demand for good property remains constant, with limited activity surrounding the lesser quality properties," REINZ rural spokesman Brian Peacocke said.

"Reduced production from a national perspective, particularly in the dairy sector, is the result of an unseasonably late spring, mainly due to the volatile weather conditions."

Grazing properties accounted for the largest number of sales with a 31% share of all sales over the three months to December, while finishing properties made up 27% of sales, dairy properties 14% and horticultural properties 12%.

On the lifestyle front, 2191 lifestyle properties were sold in the December quarter, down 3.8% compared to the same period of 2015, while prices continued to climb.

The median price of all lifestyle properties sold in the three months to December was $583,000, which was a record high and up 6% compared to a year earlier.

Farm sales

Select chart tabs »

The 'New Zealand' chart will be drawn here.
New Zealand
Source: REINZ
The 'Arable' chart will be drawn here.
Source: REINZ
The 'Dairy' chart will be drawn here.
Source: REINZ
The 'Finishing' chart will be drawn here.
Source: REINZ
The 'Forestry' chart will be drawn here.
Source: REINZ
The 'Grazing' chart will be drawn here.
Source: REINZ
The 'Horticulture' chart will be drawn here.
Source: REINZ



We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.


There has been a burst of very strong farm sales in this area, prices up to $1000 a stk unit. I think it's crazy but it is what it is. A farm a friend of mine purchased for 800k, hill country, clay, wet in winter dry in summer just sold for 7 mil. So farms are back moving after a small blip, incomes are down capital values up.

Do you think some are buying on the expectation of milk prices heading above $7.00? Sheep and beef prices are not expecting to be that great?

it's almost all sheep and beef around me but even the one dairy farm that was sold, was top dollar. I am surprised at the optimism in hill country sheep and beef, returns are scary low. Must be people with money, who can see a bright future.

I had a bit of fun looking at budgets for that 7 mil farm and they were all bad. I was reading an article in Aussie a few weeks ago , a farm accountant was pointing out that if it takes 20 years to pay off just %10 of debt/total assets , it makes one wonder why the asset value is so high in the first place.

I met with a rural Real estate agent yesterday and he thought values would stay high, he said that in the last 20 years the capital gain on a farm has averaged nearly %15, all you have to do is hang in there and it's a road to riches, however I had to point out that %15 on a farm worth 2k an acre is less than %15 of a farm worth 10k an acre and compounding assets must eventually run out of rope it's just math.
So while there appear to still be buyers out there at $1000 a stk unit ( one breeding ewe). For hill country dependent on sheep at a 120-130 % lambing, $75 a lamb and wool covering the costs of shearing these farms are very poor returners on assets. I suspect most are in the red or running close to the wind. So just how much confidence is out there, how will rising interest rates and a finance bubble popping in China, which our sheep meat industry is super dependent on affect values? Last time returns were this low values per stk unit were $400 but then costs were %35 of gross sales, today costs are %80 of gross sales. Hmmm, could be along way to fall.

You are spot on Andrew, the biggest problem is that the "sheepell and 6pack Joe" have been feed the good news BS, swallowed it hook line and sinker, little knowing that they are trudging up the financial slaughter ramp.

Hi Realtor in France, been a long time. It was Waikareo Station Wallingford, that I hear just sold for 7 million. The place on the left going South towards Porangahau, with the two story house over the stream.
Have you settled back in NZ for good?
My wife is wanting time with her elderly parents in the UK, so I try to do a few months there every year. We always end up with friends in France, mainly around Nimes. I miss California, my mates in construction and development tell me the housing market is going to crash again and soon. We loved living there, the sun is a bit much but they just had 12' of rain and the children love the skiing, 24 ft of snow this year, my friends up by the mountain are all snowed in. Ski passes are $25 a day and the mountain is covered in trees. My children got used to the School skiing team, skiing, Mt Shasta, Mt Ashland, Mt Bachelor, Tahoe and Mammouth. They are not scarred of a few hours driving. So much more available in Europe and the USA.
So now NZ feels, small, very expensive with low wages. I suspect the youngest two children have been 'imprinted' California and will return to live, also the schools were very good, our friends had children at Eton and my children were surprised to find they were doing the same level work, same books etc and did not have the £ 40+ k fees.
I am giving up on any thought of farming here, it's just too expensive, both to farm and the capital required. Many of my friends are sick of the nutrient limits and general restrictions being placed on us by councils, when we all know it's only a few operators doing the damage, hell, 30 years ago we had no problems, all we have had change is some large scale dairy operations , cattle on Techno systems and large cattle feed pads. So why not deal with them and leave the rest of us to do what we do unimpeded? Talked to a mate about dairy farmers in the Bay of P and he said some are going to give up due to Council regulations and N limits pushing them out.

I also think we are going through great change, the USA is going to be a big competitor, they are now putting up these hoop barns and fattening a lot of cattle inside, in the mid-west, instead of shipping south to Texas etc. They can make about $400 a head and a lot of the grain farmers are getting into it and using their seconds from harvest. Hoop barns,
The USA beef kill was up %6 last year, forecast %4 increase the next two years.
So I still think things are going to change, it's just taking so much longer than I thought, they have let the debt to get to massive proportions, to correct is going to be challenging. My bank has been a shit to me after I complained about o/d fees, I was basically shut down and told to bugger off. ( Rabo) If they are treating other clients that way, I would not like to be on the wrong side of them. Fees for my 150k o/d facility last year were $3840.

Hawkes bay feels like it's in constant drought, I wouldn't buy a farm here until we can get our heads around the cold springs and late droughts. Sheep farming is really going through a nasty stage and many finishers are going to struggle to get lambs. The UK market for lamb is up %30 but our currency is up %28. Aussie sheep farmers are doing a lot better.
Take care.

Your access to our unique content is free - always has been. But ad revenues are under pressure so we need your direct support.

Become a supporter

Thanks, I'm already a supporter.

Days to the General Election: 37
See Party Policies here. Party Lists here.