21 Oct 2016

Farm sales up as neighbours eye surrounding land

8:40 am on 21 October 2016

Farm sales across the country are on the rise, new figures show.

A Tasman District farm beneath the Arthur Ranges

A Tasman District farm beneath the Arthur Ranges. Nelson topped the list of farm sales for the three months to September 30. Photo: RNZ / Tracy Neal

The latest Real Estate Institute data shows 388 farms sold in the three months ending in September - 51 more compared to the same period last year.

The overall price per hectare has increased $800 to $26,825.

But the price for dairy farms per hectare has risen by over 30 percent in the three months to September this year.

Real Estate Institute spokesman Brian Peacocke predicted dairy farm sales would stay strong.

"We're going to see quite a big change in numbers in the next three months, and that's because of the number of farms coming onto the market currently - assuming of course that they sell.

"I expect the good farms will sell well and retain value based on last season. The second or third tier - if it's dairy - are a little bit untested at the moment, so we're unsure what the demand will be for those."

Many properties were being bought by neighbours, he said.

"Given that that is the scenario you can never tell what is going to come to light when a farm comes on the market - clearly there are a lot of farmers with good solid balance sheets [who] have the ability to buy if the right property comes up."

Northland produced some interesting sales figures, Mr Peacocke said.

"[There's] a positive mood and strong activity surrounding beef units in Northland, particularly in the start-up range of $6,500 to $7,500 per hectare, and an interesting new development for the region with a surge in sales of land suitable for growing avocados."

Nine regions recorded an increase in farm sales volume for the three months ended September 2016 compared to the same period in 2015.

Nelson topped the list of increased sales with 14 more in the past three months than the same period in 2015, closely followed by Southland, the Bay of Plenty and Otago.

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