Farm, lifestyle sales growing

Farm sales increased 38 per cent in the last quarter. Photo / Stephen Russell

Farm sales are the highest in nearly two years and the trend is rising, says the Real Estate Institute of New Zealand.

In total 1003 farms were sold during the 12 months to August 2011 - the first time since October 2009 the annual tally had exceeded 1000 which indicated the underlying trend was rising, it said.

Institute rural market spokesman Brian Peacocke said farmer returns remained solid with an expectation for commodity prices to hold or in some cases firm slightly as the season progressed.

There were 265 farms sold in the three months ended August - up 38 per cent on the same time last year but down 12 per cent on the period ended July.

Dairy farm sales were low, as expected for this time of year, although there was demand for good quality grazing, fattening and dairy support units with sales spread evenly across the country, he said.

"What is encouraging is the solid increases in the number of sales across most farm types compared to this time last year, with all but one region recording an increase in sales compared to August 2010," Peacocke said.

The median price per hectare for the three months to August was $15,148 for all farms, compared to $16,968 last year.

"I think that as more properties become available based on the inquiry that's emerging already that will put a little bit of pressure on prices if the shortages [of] supply continues," he said.

"So we expect that there'll be more properties being sold but the prices will be remaining reasonably constant."

Lifestyle market sales for August were down from a peak in May but well above last year, Peacocke said.

The number of lifestyle properties sold for the three months ended August was 1304, up from 1066 in the same period last year, with a median price of $444,000 down from $453,000 for the period ended July.

"The continued easing in the median price is consistent with the trends in the rural and residential property markets, where sales volume increases are occurring but prices are either trending sideways or easing," Peacocke said.

A survey by First National across its rural realtors said that despite fewer listings, lifestyle properties were being snapped up by city buyers looking to escape to the country.

First National Group general manager John Stewart said after several years of relative inactivity there appeared to be some pent-up demand.

He said perhaps people had pushed through their concerns about higher petrol prices.