The number of farms sold during the three months to June has fallen to some of the lowest levels in recent years, according to figures from the Real Estate Institute.
The institute is blaming the lower Fonterra dairy payout as having a knock-on effect to other areas of the market.
The institute's figures show 285 farms were sold in the three months to June, compared to 711 in the three months to June 2008 and 665 in the same period the year before.
Rural spokesperson Peter McDonald says there was a particular drop-off in Southland, where 113 farms were sold in the June 2008 quarter, compared to 21 this year.
Mr McDonald says while there was a spike in the median farm sale price last year, this has since fallen back to $1.15 million, which is similar to prices in 2007.
He says this is not surprising, considering the forecast milk payouts for both periods are also similar.
Federated Farmers Dairy chairman Lachlan McKenzie says the fall in value of rural property is being driven by restrictions on credit as well as lower commodity prices.