Upbeat farmers holding onto their properties

An upbeat mood in the rural sector means fewer farmers are putting their farms on the market right now, according to the Real Estate Institute of NZ.

The latest REINZ Rural Market Statistics showed a total of 369 farms were sold across the country in the three months to August.

That was 16 per cent up on the same time last year but down 15.8 per cent on the three months to July.

Brian Peacocke, REINZ rural spokesman, said the "relatively constrained" sales figures for August were mainly a result of farmers being more focussed on their seasonal workloads than selling property.

Good weather and solid early Spring grass growth meant a mood of optimism was prevailing in the rural sector.

"The livestock market in saleyards around the country is buoyant and a healthy barometer for the rural environment," Peacocke said.

"Because of those conditions, the majority of farmers are in good spirits and many appear to be happy to retain their properties for now in order to capitalise on the higher returns being predicted by the export sector."

The end result was strong demand but a current shortage of supply, he said.

So far this year, a total of 1541 farms have been sold, which is 6.2 per cent more than were sold in the year to August 2012.

The REINZ All Farm Price Index - which adjusts for differences in farm size, location and farming type - rose by 0.9 per cent in the three months to August compared to the three months to July, from 2,953.0 to 2,980.9.

Farm prices appear to be rising, with the median price per hectare for all farms sold in the three months to August being $21,676. That was 20.7 per cent higher than for the same period last year and 4.9 per cent compared to the three months to July.

Of the regions, the Bay of Plenty recorded the biggest increase in sales compared to last year, followed by Auckland, Waikato and Taranaki.

Grazing properties accounted for 42.3 per cent of all sales, followed by finishing properties (25.5 per cent), dairy properties (9.5 per cent) and horticulture properties (10 per cent).

The REINZ Dairy Farm Price Index - which adjusts for differences in farm size and location - dipped by 0.1 per cent compared to the previous three months, from 1,777.1 to 1,776.1.