Article: REINZ News
Rural Sales Volumes Rise Further, Prices Continue To Ease -Market Still Quiet
Data released today by the Real Estate Institute of NZ (“REINZ”) shows there was a further improvement in the number of rural sales across New Zealand in the three months to June 2011. Overall, there were 393 farm sales in the three months to end of June2011 compared with 364 sales in the three months to May 2011 and 302 sales in the three months to June 2010.
The median price per hectare for all farms sold in the three months to June 2011 was $15,568 compared to $17,199 in the three months to May 2011 and $17,772 for the three months to June 2010. The median price per hectare is now at its lowest point since July 2004 and continues the downward trend in median prices evident since early 2009.
The Otago region recorded the strongest increase in sales between May and June, followed by Canterbury and Manawatu/Wanganui. Two regions recorded a fall in sales between May and June, although these falls were minor.
The number of farm sales for the year ended June 2011 was 960, 30 more than the number of farm sales for the year ended May 2011, and up from 931 sales recorded for the year ended June 2010.
“The increase in farm sales for the three months to June continues the turn around in volumes that began in April, although with the onset of winter the rate of increase has slowed,” says REINZ Rural Market Spokesman Brian Peacocke. “Most of the sales activity was in the grazing, dairy support and finishing sectors in the South Island with Southland again recording the largest number of sales.”
“We are seeing a noticeable increase in enquiry from purchasers targeting potential transactions in the spring, as well as an increase in the number of appraisals being done for sellers. The overall increase in activity from both buyers and sellers is being matched by a reinvigoration of interest in rural lending coming through from the banking sector,” said Mr Peacocke.
Included in sales for the month of June were 13 dairy farms at an average sale value of $24,081 per hectare and $35 per kg of milk solids (MS). The average farm size was 192 hectares with a range of 27 hectares in the Waikato to 541 hectares on the West Coast. The average production per hectare across all dairy farms sold in May 2011 was 693 kgs of milk solids.
Grazing properties accounted for the largest number of sales with 53.2% share of all sales over the three months. Dairy properties accounted for 14.8%, Finishing properties 15.0% and Horticulture properties 6.1%. These four property types accounted for 89.1% of all sales during the three months ended June 2011.
For the three months ended June 2011 the median sales price per hectare for dairy farms was steady at $30,828 (58 properties) compared to the three months ended May 2011 (60 properties), and $32,609 (31 properties) for the three months ended June 2010. The median dairy farm size for the three months ended June 2011 was 116 hectares.
For the three months ended June 2011 the median sales price per hectare for finishing farms was $10,377 (59 properties) compared to $10,860 for the three months ended May 2011 (55 properties), and $8,262 (38 properties) for the three months ended June 2010. The median finishing farm size for the three months ended June 2011 was 157 hectares.
For the three months ended June 2011 the median sales price per hectare for grazing farms was $12,892 (209 properties) compared to $13,490 for the three months ended May 2011 (186 properties), and $12,904 (146 properties) for the three months ended June 2010. The median grazing farm size for the three months ended June 2011 was 90 hectares.
For the three months ended June 2011 the median sales price per hectare for horticulture farms was $132,401 (24 properties) compared to $129,572 for the three months ended May 2011 (28 properties), and $148,221 (51 properties) for the three months ended May 2010. The median horticulture farm size for the three months ended June 2011 was 7 hectares.
The lifestyle property market also saw a further lift in volume in the three months to June 2011 although the median price remained at the same level compared to May. All regions apart from Northland and Gisborne saw an increase in sales, with Canterbury recording the strongest increase (up 28 sales). Nelson and Otago also recorded notable increases in sales volumes.
The national median price remained steady at $460,000 for the three months to June 2011, and rose $15,000 compared to the three month to June 2010. Total sales completed for the three months to June 2011 were 1,386, up 75 (5.8%) compared to the three months ended May 2011, and up 273 (24.5%) compared to the three months ended June 2010.
Commenting on the lifestyle property market statistics Brian Peacocke said, “The lifestyle property market is also demonstrating rising sales volumes with a 6% increase in June compared to May and an almost 25% increase compared to June last year, with almost all regions recording an increase in volumes. The median price for lifestyle properties was flat in June compared to May at $460,000, but was $15,000 higher than June last year.”
Rural Highlights – June 2011
Northland
The median selling price per hectare in Northland eased further to $11,765 in June 2011 (May 2011: $12,533; June 2010: $19,909). 25 farms sold (May 2011: 24; June 2010: 28). The 25 farms sold consisted of 15 grazing properties, four dairy, two horticulture, two forestry, one finishing and one special.
The median price for a lifestyle block eased slightly to $320,000, in June, from $322,500 in May (June 2010: $300,000). 111 lifestyle blocks sold during the period (May 2011: 118; June 2010: 95).
