South Island dairy farmers are selling up to come north in hopes of finding more affordable land, a Wanganui rural real estate agent says.
The Real Estate Institute of New Zealand's rural market report revealed Manawatu-Wanganui farm sales jumped to 49 in the three months to December, up from 34 in the same period a year before.
Sales of lifestyle blocks dropped to 94, down from 135.
The total median selling price per hectare for all farms was $16,027 - a drop from $18,298.
Property Brokers rural agent Richard White said a lot of recent buyer interest could be due to a market realignment after recovery from the global financial crisis.
At the end of last year buyers were "a bit picky" when looking for properties, although there was not an abundance of listings to choose from.
"If there's anything about a property that could put them off they'll shy away from it.
"This year is slightly different ... definitely the confidence is there.
"It's got a good, positive outlook."
Confidence was up in the dairy industry, but sheep and beef farmers remained more cautious, he said.
"Murmurings" on likely rising interest rates were making potential buyers consider purchasing now while rates remained low.
Mr White had received numerous inquiries from South Island farmers who had migrated south from Waikato and South Taranaki in the 1980s and converted their southern farms to dairy, buying up more land for runoff.
"They're actually pushing [farms] further out into the hinterland."
As South Island land prices became more and more expensive, some farmers were returning north with their families looking for more affordable properties.
"We're still fielding inquiries at the moment from the South Islanders."
Nationwide, 554 farms were sold in the last quarter - a 20 per cent year-on-year jump.
The annual number of sales was also up 20 per cent to 1756, the biggest 12-month turnover since February 2009.
Federated Farmers fears dairy farms nationwide have become too expensive.
The median dairy farm sale price climbed 11 per cent to $38,267 a hectare with a median farm size of 112ha.
That compared with a median price of $24,163 a hectare for all farms.
The volume of dairy farm sales almost doubled in the three-month period to 121 from 63 properties a year earlier, and this figure was bolstered by 62 farms changing hands in December alone.
Federated Farmers chief executive Conor English said farms were continuing to expand with stock units growing while the number of actual farmers declined.
"Often it's neighbours buying up neighbours' land, that will often be the first port of call for any real estate agent.
"So farm size has gotten bigger over the last 20 years," English said.
Grazing properties were the predominant type of land sold, accounting for 43 per cent of all sales, while dairy made up 22 per cent of sales.
Horticulture farms were the most expensive, with a median price of $141,134 a hectare, and a median farm size of 5ha.