Re-zoning boosts lifestyle block sales

Lifestyle blocks are on the rise.

Lifestyle blocks have hit record prices around the country as re-zoning and developments see buyers eyeing the rural market.

Real Estate Institute of NZ data shows that the national median price for lifestyle blocks throughout the country rose 7.8 per cent to a record $550,000.

Prices have lifted by $40,000 when compared with March 2014.

Strong activity in the $1 million to $2 million range on the southern fringe of Auckland has been stimulated by re-zoning and saw the median price in the region rise by $140,000 from $840,000 for the three months to March last year to $980,000 for the equivalent period this year, an increase of nearly 17 per cent.

Canterbury also saw prices hit a record high, reaching $641,250, as development moves southwest of the city.

Lifestyle sales were steady throughout the centre of the North Island with a strong level of sales in the Bay of Plenty.

Overall there was a 6.7 per cent lift in lifestyle sales volume in the three months to March this year compared with the corresponding period last year.

Meanwhile, the high dollar and the reduced dairy payout have prompted buyers to be cautious when entering the farming market.

Dairy farmers this season are faced with a farmgate milk price forecast of $4.70 a kilo of milksolids, down from last year's record $8.40.

At the same time, the New Zealand dollar has remained firm.

There were 47 fewer farm sales for the three months ended March this year compared with last year -- a 10 per cent drop.

However, the median price a hectare for all farms rose to $27,957 in the three months to March 2015, compared with $22,342 for the three months ended March 2014.

It dropped by less than 1 per cent compared with February.

Three regions recorded increases in sales volume -- Auckland, Hawke's Bay and Wellington.

Northland continued to have healthy sales activity with buyers able to get larger properties at values lower than in regions to the south.

"The general tone of the market for the three months ended March has been very solid, with demand ensuring quality properties have sold extremely well," says Real Estate Institute rural spokesman Brian Peacocke.

"The impact from the subsequent shortage of supply has resulted in increased focus on a number of properties which for a variety of reasons, including contour and location, have been harder to sell.

"The reduced dairy payout and the high dollar are being carefully assessed by prudent purchasers, while the drought conditions in particular have had a negative impact on some regions in the South Island."

The institute's all farm price index rose 2.7 per cent in the three months to March compared with the three months to February, moving from 3256.6 to 3343.8.

There was a slump in the dairy farm value, the price dropping to $37,761 a hectare for the three months ended March compared with $45,105 for the three months ended February.

Included in sales in March were 38 dairy farms at a median value of $34,208 a hectare.

The median farm size was 110ha with a range of 22ha in Waikato to 366ha on the West Coast.