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Data released today by the Real Estate Institute of New Zealand (REINZ) shows there were 39 fewer farm sales (-20.0%) for the three months ended October 2023 than for the three months ended October 2022. Overall, there were 156 farm sales in the three months ended October 2023, compared to 158 farm sales for the three months ended September 2023 (-1.3%), and 195 farm sales for the three months ended October 2022.
In the year to October 2023, 1,069 farms were, 476 less than were sold in the year to October 2022, with 34.5% fewer dairy farms, 8.6% fewer dairy Support, 28.8% fewer grazing farms, 33.9% fewer finishing farms and 29.6% fewer arable farms sold over the same period.
The median price per hectare for all farms sold in the three months to October 2023 was $30,250 compared to $27,100 recorded for the three months ended October 2022 (+11.6%). The median price per hectare increased 22.2% compared to September 2023.
The REINZ All Farm Price Index decreased 2.6% in the three months to October 2023 compared to the three months to September 2023. Compared to the three months ending October 2022 the REINZ All Farm Price Index decreased 8.7%. The REINZ All Farm Price Index adjusts for differences in farm size, location, and farming type, unlike the median price per hectare, which does not adjust for these factors.
Three regions recorded an increase in the number of farm sales for the three months ended October 2023 compared to the three months ended October 2022, with the most notable being Waikato (+6 sales) and Auckland (+5 sales). Canterbury ( -15 sales) and Bay of Plenty ( -9 sales) recorded the largest decreases in sales. Compared to the three months ended September 2023, 4 regions recorded an increase in sales, the most notable being Waikato (+13 sales) and Nelson/Marlborough (+5 sales).
Shane O’Brien, Rural Spokesman, at REINZ says: “The October farm sales statistics show a continuation of the trend over much of 2023 with a decrease in the volume of sales across all categories across most of New Zealand. An increase in sales is noted in both the Auckland and Waikato regions but, a drop in the volume of sales compared to the same time last year was evident in Canterbury and Southland.
Much of this decrease can be offset by a late Spring with many properties coming to the market later than usual due to the wet winter and early spring as well as some vendors choosing to wait for some direction from the recent general election before going to market.
There appears to be no shortage of listings across New Zealand this Spring, giving buyers a healthy selection. Many buyers however are being cautious around environmental compliance and future land uses. Product price uncertainty particularly in the pastoral farming and dairy sectors is weighing heavily on buyers’ decisions but the recent confirmation of the three-way government coalition and the promise of ‘being a farmer-friendly government’ should impact market sentiment.
Strong recent sales in the Waikato in the dairy support sector are an encouraging sign but there are still some headwinds facing the horticulture and forestry sectors that have slowed sales this quarter.
The median sale price paid across New Zealand has increased slightly in the last quarter and is up on the same time 12 months earlier. While this is an encouraging sign, market vendors do need to be mindful that with an abundance of listings and a cautious pool of buyers, any offers when presented may need to be carefully considered as buyers take into account the changing dynamics of the market including farm product prices, interest rates and confidence in the economy as a whole.”
In October 2023, finishing farms accounted for a 39% share of all sales. Grazing farms accounted for 22% of all sales, Dairy farms accounted for 10% of all sales and Horticulture farms accounted for 9% of all sales. These four property types accounted for 80% of all sales during the three months ended October 2023.
Dairy Farms
For the three months ended October 2023, the median sales price per hectare for dairy farms was $32,690 (15 properties), compared to $32,690 (15 properties) for the three months ended September 2023, and $47,565 (24 properties) for the three months ended October 2022. The median price per hectare for dairy farms has decreased 31.3% over the past 12 months. The median dairy farm size for the three months ended October 2023 was 118 hectares.
On a price per kilo of milk solids basis, the median sales price was $39.25 per kg of milk solids for the three months ended October 2023, compared to $28.59 per kg of milk solids for the three months ended September 2023 (+37.3%), and $38.18 per kg of milk solids for the three months ended October 2022 (+2.8%).
The REINZ Dairy Farm Price Index increased 10.7% in the three months to October 2023 compared to the three months to September 2023. Compared to October 2022, the REINZ Dairy Farm Price Index decreased by 12.5%. 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.
Finishing Farms
For the three months ended October 2023, the median sale price per hectare for finishing farms was $39,160 (61 properties), compared to $38,510 (55 properties) for the three months ended September 2023, and $32,450 (48 properties) for the three months ended October 2022. The median price per hectare for finishing farms has increased 20.7% over the past 12 months. The median finishing farm size for the three months ended October 2023 was 38 hectares.
Grazing Farms
For the three months ended October 2023, the median sales price per hectare for grazing farms was $11,245 (34 properties), compared to $11,700 (41 properties) for the three months ended September 2023 and $12,940 (70 properties) for the three months ended October 2022. The median price per hectare for grazing farms has decreased 13.1% over the past 12 months. The median grazing farm size for the three months ended October 2023 was 121 hectares.
Horticulture Farms
For the three months ended October 2023, the median sales price per hectare for horticulture farms was $233,330 (14 properties), compared to $324,210 (16 properties) for the three months ended September 2023 and $385,520 (20 properties) for the three months ended October 2022. The median price per hectare for horticulture farms has decreased 39.5% over the past 12 months. The median horticulture farm size for the three months ended October 2023 was 9 hectares.
