Big wet hampers farm sales

Wet weather this winter has put a handbrake on farm sales generally, while tighter environmental rules have knocked the dairy real estate market.

Demand for lifestyle properties in the Auckland region has slowed to a point where sales numbers for August were at their lowest monthly level since January 2012. Sales in June, July and August for all farms were down 20 per cent on the same period last year, while 1707 farms sold to the year ended August – 3.3 per cent lower than the year before.

The drop-off in sales was across the board regionally, with nine of 14 regions recording decreases. Buyers were also holding off bidding for lifestyle blocks, with 10.8 per cent fewer sold in the year. On the other hand the median price for all lifestyle properties sold in the three months to August was $590,000, a rise of $45,000 on the corresponding period last year.

While the median price per hectare of a dairy farm fell 6.5 per cent over the past 12 months to $37,842, the Real Estate Institute of New Zealand (REINZ) all farm price index rose 8.9 per cent.

REINZ rural spokesman Brian Peacocke said although dairy prices were buoyant, it would take until October next year before Fonterra’s improved farmgate prices would feed through into farmers’ pockets.

‘‘We are coming through a period of caution and the industry is facing an increasing raft of compliance issues so those things combined mean people are being cautious over what they are prepared to pay for land.’’

The lack of sales was not surprising at a time of record rainfall in many districts. ‘‘In this environment, those considering making their properties available for sale simply do not want outsiders in sight,’’ he said.