Property report: Rural market shifts - dairy slows, sheep and beef gain interest

Peter Newbold, general manager PGG Wrightson Real Estate.

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Momentum in New Zealand’s rural property market has changed, with dairy farm listings slow, while sheep and beef farms experience an increase in interest.

That’s the sentiment expressed by PGG Wrightson’s General Manager for Real Estate, Peter Newbold.

Speaking to The Country’s Jamie Mackay, Newbold noted that many dairy farmers had been holding off on selling, to take advantage of strong returns.

While this strategy made sense in the short term, Newbold cautioned that farmers who delayed too long could miss the ideal selling window.

“If you look out a year, you could argue that some will have missed the opportunity…more properties may have hit the market, and [today’s] keen buyers may have moved on.”

“It’s an interesting space,” Newbold said.

The Reserve Bank’s move this week to drop the Official Cash Rate (OCR) by 50 basis points led to speculation about rising property prices.

Listen below:

However, Newbold suggested that any increase would be modest, due to ongoing financial pressures.

“I don’t think [prices] will increase as much as people may think because, on the other side, you’ve got to look at cost of living - fuel, food, rates, insurances.

“All those things, they’re not coming back.”

Newbold agreed one of the more positive stories this season was the resurgence of the sheep and beef sector.

While wool remained a challenge, lamb prices have held steady, boosting farmer confidence.

“I’ve been out in the field recently, and the sentiment among sheep and beef farmers is a lot better,” Newbold said.

“They’ve banked [some good returns] this season, and I see a strong future when you look out over the next 12 to 18 months.”

“I think we’re going to see more movement in sheep and beef.”

Also in today’s interview: Newbold and Mackay discussed the prospects for the horticulture sector and their expectations for more activity during the busy autumn period.