With an increased milk payout and higher beef prices “a quiet air of confidence or perhaps relief is quietly growing with the rural sector”, Real Estate Institute rural spokesman Brian Peacocke said.
Sales for the three months to the end of July were down by 76 to 392 compared to the end of June when there were 459 sales. In the July period last year there were 468 sales.
Offsetting the activity level, overall prices were higher with the institute’s All Farms Index rising 5.56% to July 2017 compared to the June three-month period and was up 9% on the July period last year. The All Farms Index was regarded as the most accurate measure of pricing because it adjusted for differences in farm size, location and farming type.
The median price per hectare, which did not make that adjustment, was $27,158 for the July three months, up from $26,492ha a year earlier. That was a 2.5% gain and the June to July improvement this year was 4.5%.
PGG Wrightson Real Estate general manager Peter Newbold backed up Peacocke’s comments, saying winter sales activity had been slow and would be through August.
However, he was confident of a spring upturn with values holding firm and volumes increasing through October and November.
Canterbury had the biggest increase in sales in the July period, though off a low base, and West Coast was next. Canterbury had a reasonable level of finishing farm sales at good, solid prices, Peacocke said.
The Northland and Auckland areas also had steady activity, including several strong sales in the Pukekohe and Karaka area.
Finishing farms had 39% of all sales over the July period, the most of any sector, with the median price being $30,882ha, up from $27,613ha for June and $26,249ha for July last year, leading to a 17.7% year-on-year gain.
Peacocke described the Canterbury arable market as “simmering” with one very good sale of a Methven farm at just over $57,000ha.
For dairy farms, the median sale price for the three months ended July 31 was $36,332ha, up from $34,789ha for the June period and $35,614ha for July last year. The median price was up 2% year-on-year.
The institute’s Dairy Farm Index, which also adjusts for differences in farm size and location, rose 4.3% over the latest three-month period but was down 0.9% year-on-year.
