Real Estate Institute Of New Zealand (REINZ) Reports Strong Growth In New Zealand's Rural Market

The latest data from the Real Estate Institute of New Zealand (REINZ) shows a 26.5% increase in farm sales for the three months ending September 2024 (+40 year-on year). 191 farm sales were recorded in September, a slight decrease from the 201 sales (-5.0%) month-on-month) from August 2024.

Looking at the year ending September 2024, 928 farms were sold, which was 150 less than the previous year. There were 23.1% fewer Dairy farms, 3.6% fewer Dairy Support farms, 27.9% fewer Grazing farms, 20.2% fewer Finishing farms, and 25.6% more Arable farms sold over the same period.

The median price per hectare for all farms sold in the three months to September 2024 was $27,900, a 13.0% increase from September 2023 and an 11.0% increase compared to August 2024.

“It is very pleasing to report on the recent lift in sales volume over the past three months. So far, this year has been a cliched year of two halves, with limited sales activity throughout the first half of the year. Still, the recent lift in the dairy payout and a slight reduction in interest rates, with further cuts being signalled, has given the market some much-needed impetus,” commented REINZ Rural Spokesperson Shane O’Brien.

In the regionals, ten regions saw increased farm sales, with Manawatu-Wanganui (+14 sales) and Canterbury (+12 sales) both leading the way.

Overall, the REINZ All Farm Price Index decreased by 2.9% in the three months to September 2024 compared to the previous three months and by 14.0% compared to the same period in 2023. This index considers farm size, location, and type, unlike the median price per hectare.

“Agents across the country have reported considerable demand in the dairy sector, with several recent offerings of tier-one Dairy farms reporting strong enquiries, which we haven’t seen for 24 months or more. Dairy Support sales also contributed to the result, making up 11% of the total sales volume,” said O’Brien.

In September 2024, Grazing farms made up 22% of sales, Finishing farms made up 21%, Horticulture farms made up 15%, and Dairy Support farms made up 11%. Together, these four types of properties made up 69% of all sales for the three months ending September 2024.

“The market is active moving into Spring, but some sectors still face headwinds. The sheep sector, in particular across some regions, is still struggling due to low prices and arid conditions, and as such, buyer confidence is low. However, it is encouraging to see some bounce back in the horticultural sector with some sales recorded after a 12-month period of limited activity,” said O’Brien.

Dairy Farms

The median sales price per hectare for Dairy farms, based on 13 properties, increased to $39,260 in the three months leading up to September 2024, up from $36,930 in August 2024 and $32,690 in September 2023. The median size of a Dairy farm for the three months ended September 2024 was 82 hectares, and the median price per hectare has increased by 20.1% over the past year.

When it comes to the price per kilo of milk solids, the median sales price was $45.97 per kg for the three months ended September 2024, compared to $45.19 per kg for the three months ended August 2024 (a 1.7% increase), and $28.59 per kg for the three months ended September 2023 (a 60.8% increase).

The REINZ Dairy Farm Price Index decreased by 3.5% from August to September 2024 but increased by 28.5% compared to September 2023. The index adjusts for farm size and location differences, unlike the median price per hectare.

Finishing Farms

For the three months ended September 2024, the median sale price per hectare for Finishing farms was $34,750 (41 properties), compared to $33,520 (33 properties) for the three months ended August 2024 and $36,985 (50 properties) for the three months ended September 2023. The median price per hectare for Finishing farms has decreased -6.0% over the past 12 months. The median Finishing farm size for the three months ended September 2024 was 31 hectares.

Grazing Farms

For the three months ended September 2024, the median sales price per hectare for Grazing farms was $12,610 (42 properties), compared to $13,345 (58 properties) for the three months ended August 2024 and $11,660 (40 properties) for the three months ended September 2023. The median price per hectare for Grazing farms has increased 8.1% over the past 12 months. The median Grazing farm size for the three months ended September 2024 was 92 hectares.

Horticulture Farms

For the three months ended September 2024, the median sales price per hectare for Horticulture farms was $191,200 (28 properties), compared to $255,620 (23 properties) for the three months ended August 2024 and $324,210 (16 properties) for the three months ended September 2023. The median price per hectare for Horticulture farms has decreased -41.0% over the past 12 months. The median Horticulture farm size for the three months ended September 2024 was 7 hectares.

As we look ahead, these trends offer a glimpse into the evolving landscape of New Zealand’s agricultural sector. Whether you’re a buyer, seller, or simply interested in the market, staying informed is vital. For further details and insights, please visit the REINZ website.

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