Rural property market subdued but stable

NEWS RELEASE 27 JUNE, 2002

Rural property market subdued but stable

Farming confidence has eased, and adverse weather has taken it’s toll but the rural property market remains stable, with the national farm median price up 10.23 per cent from May last year, according to the rural property statistics for May 2002, released today by the Real Estate Institute of New Zealand.

The national median sale price for May was $643,750 well improved on the May 2001 median of $584,000, although seasonal factors saw it ease on the April 2002 median of $720,000.

Conversely, the national sales volume for May 2002 was down from last year but improved on last month, at 262 transactions for May, compared to the April sales volume of 253 and the May 2001 volume of 305.

Rural spokesperson for the Institute, Mr Murray Cleland said today that the latest figures were very pleasing given the recent easing in rural confidence, and the Real Estate Institute believed this was a reflection of a greater level of business planning in the farming community.

“Farming, like any other aspect of the economy, tends to be cyclical, so it was inevitable that the last two years of quite remarkable growth in the rural sector would eventually slow. But it is extremely important that the impact of a more subdued rural economy is placed in context.”

“The expectations of the rural sector have been somewhat dampened by recent events such as the forecast downturn in the dairy payout for the 2002- 2003 season and the tightening in Reserve Bank monetary policy, but rather than this previewing a downturn in the fortunes of the rural economy, our members report that the majority of farmers have spent the last two years preparing themselves and their businesses for just such an easing in returns.”

“Many farmers have diversified, in part seeking to avoid the highs and lows in their sectors; while others have invested in plant and machinery that enhance the cost effectiveness of their operations. As a result, the rural sector has sought to ‘future-proof’ itself against economic downturn. It is just such an approach that will enable the rural sector to remain healthy and viable, and it is an illustration of this business maturity the latest rural statistics merely reflects a more cautious approach in the rural market, and certainly cannot be described as a lack of faith in the rural property market.”

The national median price for May in the lifestyle block market firmed by 10.64 per cent on year-to-year comparison and also increased from last month, while the national sales volume eased from last month and improved on May last year. There were 594 transactions at a median sales price of $239,000 during May, compared to 658 sales in April at $230,000 and 519 in May 2001 at $216,000.

The individual sectors where farm values firmed on a year to year basis were arable property, up by 142.78 per cent; forestry property, rising by 75.31 per cent; finishing property, up by 76.19 per cent; grazing property, up by 13.48 per cent and dairy property, increasing by 4.94 per cent.

The rural sectors that experienced an easing in farm median price from May 2001 were horticultural property, easing by 4.17 per cent and special property, down by 45 per cent.

The demand for dairy properties eased on both year-to-year and month-to-month comparison, with 37 properties changing hands during May, compared to 48 in April and 52 in May 2001.

The May 2002 median sale price for dairy properties of $1,018,000 was up on the $970,000 recorded in May 2001, but eased from the $1,300,500 recorded in April 2002.

The national arable property median sale price was up on both month-to-month and year-to-year comparison, from $561,000 in May 2001 and $769,350 in April 2002 to $1,362,000 in the latest period, while sales eased slightly with at six transactions for May 2002, compared to eight sales in April 2002 and ten sales in May 2001.

Horticultural property sales rose on year-to-year and month-to-month comparison, with 35 sales in May compared to 22 sales in April 2002 and 29 sales in May 2001. The median price fell from last year but rose on last month, from $600,000 in May 2001and $514,250 in April 2002, to $575,000 in the latest period.

Finishing property sales eased on both year-to-year and month-to-month comparison, with 38 sales in May 2002 and 42 in April 2002,compared to 58 sales in May 2001. Conversely, the median price rose from both last month and last year fron a median price of $555,000 in May 2001, and a median of $852,500 in April 2002, rising to $973,000 May 2002.

One hundred and thirty grazing properties sold in May, up from the 123 sales in April but down on the 137 sales recorded in May 2001. The median sale price was up from last year and last month, rising to $505,000 in May 2002 from the $445,000 recorded in May 2001 and the $412,000 recorded in April 2002.

-ENDS-

For further information contact:
Mr Murray Cleland, REINZ Councillor Phone: (021) 950 445
Issued by sorensen group Phone: (029) 230 5768

Regional highlights:

Northland
Twenty-two farm sales were recorded in Northland in May, eleven less than April and two more than the twenty sales recorded in May 2001. Seven grazing, five finishing, two horticultural, two forestry and six dairy properties made up the total. The median farm price was $705,000, compared with $500,000 in April and $475,000 in May 2001.

A total of 34 lifestyle block sales were recorded for May, compared to 50 in April and the 39 sold in May 2001. The median lifestyle block price was $158,000, up on April’s $125,000 and down on the $190,000 recorded in May 2001.

Auckland
Fifteen farms sold in the Auckland region in May, four less than April 2002 and three less than the eighteen sales in May 2001. Sales comprised two horticultural and thirteen grazing properties. The median farm price was $485,000, more than the $475,000 recorded last month, but less than the $509,000 in May 2001.

Sales of lifestyle blocks rose on both a month-to-month and year-to-year comparison with 163 sales recorded, compared with 152 in April and 98 in May 2001. The median lifestyle block price was $300,000, compared with $327,500 in April and $305,500 in May 2001.

Waikato
The 30 farms sold in the Waikato were thirteen less than April and seventeen less than the sales recorded for May 2001. The sales comprised seventeen grazing, ten dairy, one horticultural, and two finishing properties. The median farm price was $890,000, compared with $1,200,000 in April and $775,000 in May 2001.

Eighty lifestyle blocks sold during May, compared to 55 in May 2001, and 76 in April 2002. The median lifestyle block price was $258,000, compared with $246,250 in April and $193,000 in May last year.

Bay of Plenty
Twenty-six farms were sold, seven more than the 19 sales in April 2002 and one less than the sales recorded in May last year. Seventeen horticultural, two dairy, one special, and six grazing properties made up the total. The median farm price was $548,000, compared with $698,000 in April and $700,000 in May 2001.

Thirty-two lifestyle blocks were sold, twenty less than April and sixteen less than May 2001. The median lifestyle block price was $228,750 for May, less than both the $265,000 recorded for April and the $258,750 in May 2001.

Gisborne
Seven properties changed hands in Gisborne during May, three more than April 2002 and four less than in May of last year. The median farm price was $750,000, compared with $494,368 in April and $270,000 twelve months ago.

Eight lifestyle blocks changed hands in the region, six more than April and two more than the same month last year. The median lifestyle block price was $267,500, compared with $180,000 in April and $240,000 for the same month last year.

Hawkes Bay
Thirteen farm settlements took place during May, three more than in April and three less than in May last year. One arable, five grazing, two finishing, three special, one forestry and one horticultural property comprised the total. The median farm price was $335,000, compared with $1,100,000 in April and $795,000 in May 2001.

Lifestyle block sales rose to 31 in May from 25 in April and compared to 26 sales in May last year. The median lifestyle block price was $195,000, consistent with April 2002 and compared with $228,500 last May.

Taranaki
Thirteen farms changed hands in Taranaki, compared with nine in both April 2002 and May 2001. Seven grazing and six dairy properties comprised the total farm sales. The median farm price was $505,000, compared with $1,050,000 in April and $571,600 in May 2001.

Fourteen lifestyle blocks changed hands in the region, eight less than April and five more than the sales for May 2001. The lifestyle block median price was $215,000, compared with $282,500 last month and $116,000 last May.

Manawatu/Wanganui
Farm sales rose from last month - from 21 for April to 34 in May 2002, and compared to 21 sales in May 2001. Twenty-two grazing, five dairy, two special, three finishing properties and two horticultural properties comprised the total. The median farm price was $632,812, compared with $735,000 in April and $415,000 in May 2001.

The 53 Lifestyle block sales in May are three less than the sales for April 2002 and compared to the 39 sales recorded in May 2001. The median lifestyle block price was $150,000, compared with $167,500 in April and $175,000 in May 2001.

Wellington
Eight properties, consisting of four grazing, one forestry, two finishing properties and one horticultural property changed hands in the Wellington region during May, compared to eleven farm transactions in May last year and nine in April 2002. The median farm price was $302,500, compared with $280,000 in April and $360,000 in May 2001.

A total of 24 lifestyle blocks changed hands, eighteen less than the 42 recorded in April 2002 and sixteen less than the 40 for May 2001. The median lifestyle block price rose to $216,000 compared to the April figure of $198,500 and the $143,750 recorded in May 2001.

Nelson/Marlborough
Farm sales remained consistent in the Nelson/Marlborough region with eleven sales for May and April 2002, and compared to seventeen sales recorded in May 2001. Seven grazing, three horticultural and one finishing property made up the farm sales in the region. The median farm price was $700,000, compared with $380,000 in April and $420,000 in May 2001.

Thirty-one lifestyle blocks sold and the median price was $275,000, compared with $302,500 in April when 32 were sold and $240,000 in May last year when 29 blocks changed hands.

West Coast
The four transactions that took place on the West Coast during May was one less than the sales for April and two more than the sales in May 2001.

Seven lifestyle blocks sold in the region, three less than in April 2002 and two more than in May 2001.

Canterbury
A total of 27 farms changed hands in May, compared with 28 in April and 25 in May last year. There were five arable, one dairy, eleven grazing, two horticultural, one high country, two special and five finishing properties sold. The median farm price was $925,000, compared with $767,500 in April and $670,000 in May 2001.

Lifestyle block sales fell on a month-to-month basis, with 63 changing hands for May, compared to 86 in April and the 68 sales recorded in May 2001. The median lifestyle block price for the region was $273,000 compared to $186,000 in April and $217,500 in May last year.

Otago
Nineteen farms were sold in Otago comprising twelve grazing, one special, one horticultural and five finishing properties. This compared with 37 sales in May last year and 12 in April. The median farm price was $350,000, compared with $282,500 in April and $610,000 in May 2001.

Thirty-eight lifestyle blocks changed hands in the region, compared to 31 sales for April and 36 sales in May 2001. The median lifestyle block price was $174,468, down on April’s $230,000 and up on the $173,750 recorded in May 2001.

Southland
The median farm price in Southland was $842,308 compared with $821,575 in April and $527,500 in May 2001.Thirty-three farms changed hands compared to 32 in April and 44 in May last year. There were twelve finishing, sixteen grazing, one special and four dairy properties sold.

Lifestyle block sales fell from 22 for April 2002 and 21 sales in May 2001 to 16 sales for May 2002. The median lifestyle block price was $107,750, down on both April’s $122,500 and the $150,000 recorded in May 2001.

NUMBER OF SALES AND MEDIAN SALES PRICE
BY DISTRICT – MAY 2002

All Farms
All Lifestyle
No. of Sales Median No. of Sales Median
Northland 22 705,000 34 158,000
Auckland 15 485,000 163 300,000
Waikato 30 890,000 80 258,000
Bay of Plenty 26 548,000 32 228,750
Gisborne 7 750,000 8 267,500
Hawkes Bay 13 335,000 31 195,000
Taranaki 13 505,000 14 215,000
Manawatu/
Wanganui 34 632,812 53 150,000
Wellington 8 302,500 24 216,000
Nelson/
Marlborough 11 700,000 31 275,000
West Coast 4 797,500 7 118,000
Canterbury 27 925,000 63 273,000
Otago 19 350,000 38 174,468
Southland 33 842,308 16 107,750

TOTAL 262 $643,750 594 $239,000

NUMBER OF SALES BY FARM TYPE – MAY 2002

Arable Dairy Fattening Forestry Grazing Horticultural Sth Island High Country Special

Northland - 6 5 2 7 2 - -
Auckland - - - - 13 2 - -
Waikato - 10 2 - 17 1 - -
Bay of Plenty - 2 - - 6 17 - 1
Gisborne - - 1 1 2 3 - -
Hawkes Bay 1 - 2 1 5 1 - 3
Taranaki - 6 - - 7 - - -
Manawatu/Wanganui - 5 3 - 22 2 - 2
Wellington - - 2 1 4 1 - -
Nelson / Marlborough - - 1 - 7 3 - -
West Coast - 3 - - 1 - - -
Canterbury 5 1 5 - 11 2 1 2
Otago - - 5 - 12 1 - 1
Southland - 4 12 - 16 - - 1

TOTAL 6 37 38 5 130 35 1 10

FARMS - SALES AND MEDIAN PRICE BY DISTRICT
MAY 2001 APRIL 2002 MAY 2002
#. of Sales Median #. of Sales Median #. of Sales Median

Northland 20 475,000 31 500,000 22 705,000
Auckland 18 509,000 19 475,000 15 485,000
Waikato 47 775,000 43 1,200,000 30 890,000
Bay of Plenty 27 700,000 19 698,000 26 548,000
Gisborne 11 270,000 4 494,368 7 750,000
Hawke’s Bay 16 795,000 10 1,100,000 13 335,000
Taranaki 9 571,600 9 1,050,000 13 505,000
Manawatu/
Wanganui 21 415,000 21 735,000 34 632,812
Wellington 11 360,000 9 280,000 8 302,500
Nelson/
Marlborough 17 420,000 11 380,000 11 700,000
West Coast 2 119,000 5 675,000 4 797,500
Canterbury 25 670,000 28 767,500 27 925,000
Otago 37 610,000 12 282,500 19 350,000
Southland 44 527,500 32 821,575 33 842,308

TOTAL 305 $584,000 253 $720,000 262 $643,750

MAY 1998 MAY 1999 MAY 2000
# of Sales Median # of Sales Median # of Sales Median

Northland 11 850,000 16 505,000 22 525,000
Auckland 12 592,500 9 565,000 12 498,750
Waikato 26 588,500 36 884,000 33 725,000
Bay of Plenty 15 430,000 21 475,000 20 567,500
Gisborne 3 317,500 2 945,000 7 400,000
Hawke’s Bay 8 292,500 10 362,500 5 360,000
Taranaki 5 770,000 16 512,500 3 805,000
Manawatu/
Wanganui 19 350,000 23 405,080 27 540,000
Wellington 8 435,000 9 450,000 4 190,125
Nelson/
Marlborough 10 288,000 13 355,000 10 360,000
West Coast 1 775000 6 539175 5 675,000
Canterbury 20 462,500 23 410,000 24 500,000
Otago 10 605,000 11 650,000 10 645,000
Southland 10 475,000 32 495,000 29 800,000

TOTAL 158 $496,250 227 $500,000 211 $575,000

LIFESTYLE BLOCKS - SALES AND MEDIAN PRICE BY DISTRICT

MAY 2001 APRIL 2002 MAY 2002
# of Sales Median # of Sales Median # of Sales Median

Northland 39 190,000 50 125,000 34 158,000
Auckland 98 305,500 152 327,500 163 300,000
Waikato 55 193,000 76 246,250 80 258,000
Bay of Plenty 48 258,750 52 265,000 32 228,750
Gisborne 6 240,000 2 180,000 8 267,500
Hawke’s Bay 26 228,500 25 195,000 31 195,000
Taranaki 9 116,000 22 282,500 14 215,000
Manawatu/
Wanganui 39 175,000 56 167,500 53 150,000
Wellington 40 143,750 42 198,500 24 216,000
Nelson/
Marlborough 29 240,000 32 302,500 31 275,000
West Coast 5 55,000 10 60,000 7 118,000
Canterbury 68 217,500 86 186,000 63 273,000
Otago 36 173,750 31 230,000 38 174,468
Southland 21 150,000 22 122,500 16 107,750

TOTAL 519 $216,000 658 $230,000 594 $239,000

MAY 1998 MAY 1999 MAY 2000
# of Sales Median # of Sales Median # of Sales Median

Northland 37 128,000 39 150,000 35 139,500
Auckland 68 315,000 93 290,000 82 320,000
Waikato 51 156,000 51 206,500 44 204,500
Bay of Plenty 34 207,500 43 215,000 43 212,500
Gisborne 6 133,250 0 1 41,500
Hawke’s Bay 7 212,550 21 130,000 22 158,250
Taranaki 7 130,000 10 134,000 14 110,000
Manawatu/
Wanganui 35 105,000 35 120,000 39 132,000
Wellington 23 150,000 38 207,500 40 172,500
Nelson/
Marlborough 15 150,000 27 154,000 19 202,500
West Coast 5 55,000 5 57,000 8 43,000
Canterbury 55 170,000 71 163,000 59 169,000
Otago 17 157,000 18 86,500 21 188,000
Southland 4 95,000 9 66,500 11 148,000

TOTAL 364 $180,000 460 $180,000 438 $192,500

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