Demand lift boosting rural property prices overall

Demand for good rural property is outstripping supply, Real Estate Institute of New Zealand rural market spokesman Brian Peacocke says.

The situation was unlikely to change in the next few months as farmers began to make commitments for the coming season, he said.

The latest figures released by the REINZ showed there were 45 more farm sales for the three months ended January 2013 than for the corresponding period last year.

Overall, there were 399 farm sales in the three months to the end of January 2013, compared with 382 in the three months to December 2012. There were 1454 farms sold in the year to January 2013, up 18.1% on the previous year.

The median price per hectare for all farms sold in the three months to January 2013 was $23,980, an 18.1% increase on the $20,299 recorded for the three months ended January 2012. The median price rose 3.9% compared with December.

Seven regions recorded increases in sales volume for the three months ended January 2013, compared to the three months ended January 2012, Nelson recording the largest increase with 21 sales. Otago had three fewer sales.

Northern parts of the country had higher levels of activity on sheep and beef properties, whereas dairy property sales predominated in the South Island.

Demand for dairy support units was solid in Canterbury. Viticulture demand remained buoyant in Marlborough where supply and demand were evenly matched.

Grazing properties accounted for the most sales with a 44.1% share of all sales over the three months to January. Dairy properties accounted for 20.6%.

The lifestyle property market had a 22.2% increase in sales volume (up 273 sales) in the three months to January 2013 compared to January 2012.

Activity stayed strong around Auckland and steady in the rest of the North Island. In the South Island, activity was healthy in Nelson and Canterbury but weaker in the lower South Island, he said.

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