July median farm price climbs over a million dollars

As prices climb, the number of farms selling is static.

The national median farm price has moved back above the $1 million mark in July for the first time since April after several months of flatter prices.

Latest Real Estate Institute figures showed higher value horticultural and finishing property sales drove the median up. However, overall sales were static at 158 properties in July, the same as June, and well down on the 181 sales in July 2005.

Institute rural spokesman Murray Cleland said more subdued economic conditions were responsible for generally lower sales. "Although there are still more buyers than sellers, the existing property owners are tending to focus less on expansion beyond the farm gate and more on maintaining and, where possible, increasing on-farm returns," he said.

However, horticultural and finishing property sales increased from 20 to 30 and from 12 to 24 respectively, which helped drive the national median price from $820,000 in June to $1,027,500 in July.

Cleland said horticultural properties were enjoying a comeback, partly as a result of the kiwifruit industry recovery in recent years.

The lifestyle property market reflected the residential property market, with a drop in sales from 660 in June to 554 in July, well down on the July 2005 figure of 635 sales.

Auckland continued to have the highest median lifestyle property price at $710,000, compared with $620,000 in June and $582,500 in July 2005. Reserve Bank Governor Alan Bollard has warned farmers not to buy farms expecting double-digit growth in values to continue.