Positive spring conditions

Spring is traditionally rural property’s busy time. This year will be no exception.

After a challenging July and a mix of sunny periods and rain in August, pasture growth in the north is finally starting to build to levels that should match the demand of freshly calved cows and lambing ewes.

After staying colder for longer this year, soil temperatures have also started to move up at last, which is vital for grass growth.

Meanwhile, with unexpectedly positive recent movement in the Global Dairy Trade and Fonterra announcing an increase in the forecast payout, local dairy farmers finally have reasons for increased optimism.

Whether these positive signals are sustained remains to be seen, although enquiry for dairy farms is already stronger this year, both from investors and current farmers.

My PGG Wrightson Real Estate colleagues are reporting the same elsewhere.

Many farmers have waited for months as dairy returns stayed low. Now, with export markets back on an upward trajectory, the property market has more positive signals to react to.

Those farmers who have held back, waiting for the dairy sector to turn around, can now afford to be a little more confident and should see the next few months as an ideal time to test the property market.

In the Rodney region, beef and sheep grazing blocks continue to come under hot demand.

A 279 hectare property and a 317 hectare property were two larger blocks that I recently took to market. Both these farms sold at very strong levels in a short time period.

Enthusiastic enquiry for medium to large grazing blocks is still apparent.

My PGG Wrightson colleagues in our company’s Livestock division are also experiencing buoyant market conditions, with store cattle generally ranging from $2.70 to $2.90 per kilogram and better bred cattle exceeding $3.00.

It would therefore seem that this particular bubble is not about to burst any time soon.

Scott Tapp sells rural property for PGG Wrightson Real Estate, focusing on farms in the greater Rodney and Kaipara regions. He was PGG Wrightson Real Estate’s Rural Salesperson of the Year in 2014/15.