Data release by the Real Estate Institute of NZ (REINZ) provided mixed messages about the value of dairy farms. The 86 farms sold in the three months to March 2015 were priced at an average of $37,761 per hectare, well down on the $45,105 price for the 3 months of February 2015.
“The reduced dairy payout and the high NZ dollar are being carefully assessed by prudent purchasers, with the drought conditions in particular have had a negative impact on some regions in the South Island.”
Brian Peacocke
REINZ Rural Spokesman
However the REINZ Dairy Farm Price Index fell by 2.0% in the three months to March compared to the three months to February, from 2,060 to 2020. In the past three months the index has fallen by 6.4% but compared to a year ago the REINZ Dairy Farm Price Index is 14.3% higher. The REINZ Dairy Farm Price Index adjusts for differences in farm size and location compared to the median price per hectare, which does not adjust for these factors.
The median size of farms traded in the three months to March 2015 was 110 ha with sizes ranging from just 22ha through to 366ha. Median production across all farms sold in the three months to March 2015 was 932kgMS.
“The general tone of the market for the three months ended March has been very solid, with demand ensuring quality properties have sold extremely well”, says REINZ Rural Spokesman Brian Peacocke, “The impact from the subsequent shortage of supply has resulted in increased focus on a number of properties which for a variety of reasons including contour and location have been harder to sell.”
“The reduced dairy payout and the high NZ dollar are being carefully assessed by prudent purchasers, with the drought conditions in particular have had a negative impact on some regions in the South Island.”
Source: REINZ
