Property report: An interesting time for the rural market

PGG Wrightson General Manager for Livestock and Rural Real Estate Peter Newbold. Photo / Supplied

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Jamie Mackay from The Country has had his monthly chat with Peter Newbold, General Manager for Livestock and Rural Real Estate at PGG Wrightson.

Mackay said we all know winter was here but was it the off-season for real estate sales?

Newbold said it was an "interesting time".

PGG Wrightson had just come off a high with strong trading and was now in traditional winter mode, he said.

However, there was a lot of activity around appraisals, listings and properties that were coming to market early.

A lot of that was off the back of sheep and beef hill country opportunities arising through forestry.

While it was quiet, Newbold said there was a lot of work going on behind the scenes.

He was certainly looking forward to a strong spring season.

Mackay had a big question: How many sheep and beef farms were going to go to forestry in the next couple of years?

The short answer from Newbold was - a lot.

PGG Wrightson was getting enquiries every day from people thinking about whether they should sell, and the prices being paid by forestry were underpinning all the sheep and beef property values, he said.

The consensus seemed to be that it was not a bad time to sell.

One thing Newbold and his team were noticing - and encouraging - was people choosing to use a part of their land for forestry, rather than the total property.

He cautioned that the change in land use would only reveal its full impacts over the next couple of years in stock numbers and other related factors.

Mackay asked if these buyers were so-called "Queen Street farmers"?

Newbold conceded they were seeing a lot of urban buyers looking at the long-term opportunities, especially in the higher value properties of $20 and $30 million-plus.

With strong prices, many existing landowners were increasing their property sizes, he said.

Mackay then turned to dairy property values.

He said the past couple of years had seen hesitancy above $10 million and asked if that had disappeared.

Newbold said it had and that there were people spending from $10 to $20 million generally.

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Dairy properties were more challenging as they didn't have the forestry factor that was underpinning sheep and beef properties.

Vendors needed to be aware that potential buyers were doing more due diligence, especially around allowing for future market downturns, Newbold said.

This was a fact of life these days and you had to leave something for the next person who came along, he said.

Mackay pointed out that lifestyle listings were still in demand, which he attributed to people looking for a bit of space post lockdown.

Newbold agreed and said there was still interest in the lifestyle market for good properties out of town.

He emphasised that a lot of smaller communities had all the services and benefits of a big city.