This as buyers wait for the right one
Recent REINZ data has revealed a notable decrease in rural property sales for the three months ending December, with 142 fewer farm sales (-37.1%) compared to the same period in 2022.
The overall figure for the three months ending December was 241 farm sales, up from 195 in November but significantly lower than the 383 sales recorded in December 2022.
Throughout the year ending December, a total 1,059 farms were sold, down 499 compared to the previous year. The dairy sector experienced a 41.2% reduction in sales, while other categories such as dairy support (-7.3%), grazing (-32.3%), finishing (-35.1%), and arable (-26.3%) also saw significant decreases.
The median price per hectare for all farms sold in the three months ending December was $33,960, which was a 1.6% increase compared to the same period in 2022.
Shane O’Brien, rural spokesman at REINZ, attributed the reduction in sales to challenges stemming from farm product prices, on-farm interest rates, and rising on-farm inflation.
O’Brien noted a considerable number of properties remaining unsold at the end of the spring selling season in 2023, with buyers exercising caution and selectivity.
“Buyers are being cautious and considered with buying decisions, but buyers indicated they will pay for the ‘right’ property,” he said. “The depth of the buyer pool has been reduced due to the lack of the right listings for active buyers.”
The dairy sector, in particular, witnessed a substantial drop in sales – from 57 in December 2021, to 42 in December 2022, to just 14 just two months ago.
“Similar sale trends have occurred in other sectors including grazing properties that have missed out on any active buyers who see an opportunity for conversion, say, to forestry,” O’Brien said.
The REINZ All Farm Price Index fell 2.1% in the three months to December compared to the previous three months and dropped 13.5% compared to the same period in 2022. While some regions, like Auckland, experienced a slight increase in farm sales, others such as Manawatu-Whanganui and Southland recorded significant declines.
For December, finishing farms accounted for 33% of all sales, grazing farms for 20%, dairy farms for 15%, and dairy Support farms for 12%, collectively making up 80% of all sales during the period, REINZ reported.
To compare the latest figures with the previous quarter results, click here.
Click here for the REINZ rural press release. Access the Rural Market Report here.
Read the Lifestyle Market report here.
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