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Strong Finish For Rural Property Sales in December

News Release 20 January 2011


Strong Finish For Rural Property Sales in December

Data released today by the Real Estate Institute of NZ (“REINZ”) shows there were 140 more farm sales (+65.7%) for the three months ended December 2011 than for the three months ended December 2010. Overall, there were 353 farm sales in the three months to end of December 2011, compared with 213 farm sales in the three months to December 2010. The number of sales increased by 38 (+12.1%) in the three months to December 2011 compared to the three months ended November 2011. 1,193 farms were sold in the year to December 2011, the highest number of farm sales on an annual basis since June 2009.

The median price per hectare for all farms sold in the three months to December 2011 was $20,445, the same as for the three months ended November 2011 and down $3,230 per hectare on the $23,675 recorded for the three months to December 2010.

Eight regions recorded increases in sales volume for the three months ended December 2011, with Canterbury again recording the largest increase (+18 sales), followed by Waikato (+8 sales) and Southland (+8 sales). Three regions recorded lower sales with Northland recording the largest fall (-7 sales) followed by Gisborne and Wellington (-4 sales each) and Auckland (-1 sale), when compared to the three months ended November 2011. All bar one region recorded increases in sales volume compared to the three months ended December 2010.

“Rural property sales have had a strong finish to 2011 reflecting the very good growing conditions across the country, save for Southland and south Otago, rising income levels and favourable interest rates,” says REINZ Rural Market Spokesman Brian Peacocke. “We have also seen the emergence of off-shore buyers, mainly from Europe, acquiring properties in both Canterbury and other regions, although this comes after extensive due diligence and securing OIO approvals in the six to twelve months prior to purchase.”

“The market is experiencing strong sales growth in the dairy, finishing and grazing sectors. The demand for top quality dairy properties is outstripping supply, helping to underpin prices and we are seeing lower quality properties attract solid interest as a result. Sales of finishing properties are up noticeably from 12 months ago as are sales of grazing properties. High prices for commodities continue to deliver further increases in enquiry and interest from potential purchasers.”

Included in sales for the month of December were 27 dairy farms at an average sale value of $34,125 per hectare. The average farm size was 159 hectares with a range of 38 hectares in Taranaki to 305 hectares in Otago. The average production per hectare across all dairy farms sold in December 2011 was 961 kgs of milk solids.

Grazing properties accounted for the largest number of sales with 55.0% share of all sales over the three months. Finishing properties accounted for 16.1%, Dairy properties 14.2%, and Horticulture properties 6.5%. These four property types accounted for 91.8% of all sales during the three months ended December 2011.

For the three months ended December the median sales price per hectare for dairy farms was $37,045 (50 properties), compared to $36,766 for the three months ended November 2011 (27 properties), and $35,074 (43 properties) for the three months ended December 2010. The median dairy farm size for the three months ended December 2011 was 141 hectares.

For the three months ended December 2011 the median sales price per hectare for finishing farms was $20,445 (57 properties) the same as for the three months ended November 2011 (41 properties), and $12,490 (16 properties) for the three months ended December 2010. The median finishing farm size for the three months ended December 2011 was 80 hectares.

For the three months ended December 2011 the median sales price per hectare for grazing farms was $13,854 (194 properties) compared to $16,591 for the three months ended November 2011 (187 properties), and $13,636 (87 properties) for the three months ended December 2010. The median grazing farm size for the three months ended December 2011 was 80 hectares.

For the three months ended December 2011 the median sales price per hectare for horticulture farms was $137,055 (23 properties) compared to $106,471 (25 properties) for the three months ended November 2011 , and $179,167 (36 properties) for the three months ended December 2010. The median horticulture farm size for the three months ended December 2011 was 7 hectares.

The lifestyle property market also saw a continued steady increase in the number of sales in the three months to December 2011 compared to the three months to November 2011. 1,260 sales were recorded in the three months to December, up 38 (+3.1%) on the three months to November 2011, and up 171 (+15.7%) compared to the three months to December 2010.

Eight regions recorded increases in sales compared to November while six recorded falls. Hawkes Bay recorded the largest increase (+17 sales), followed by Auckland (+13 sales) and Waikato and Southland (+11 sales each). Wellington recorded the largest drop in sales (-10 sales), followed by Canterbury (-7 sales) and West Coast (-4 sales).

The national median price for lifestyle blocks rose by $26,250 (+5.8%) from $450,000 for the three months to November to $476,250 for the three months to December. Compared to three months to December 2010 the median price increased by $31,250 (+7.0%).

Commenting on the lifestyle property market statistics Brian Peacocke said, “The lifestyle market continues to be patchy with purchasers well informed and generally focused on price over other considerations. Vendors with high price expectations are revising their sales strategies to gain traction with purchasers, a situation that is not expected to change in the short term.”

----- ENDS -----

REINZ_Rural_Market_Statistics__December_2011.pdf

Real Estate Institute of New Zealand
For more real estate information and market trends data, visit www.reinz.co.nz. For New Zealand's most comprehensive range of listings for residential, lifestyle, rural, commercial, investment and rental properties, visit www.realestate.co.nz - REINZ's official property directory website.
Editors Note:
The information provided by REINZ in relation to the rural real estate market covers the most recently completed three month period; thus references to December refer to the period from 1 October 2011 to 31 December 2011.


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