Demand leaps for Northland lifestyle blocks

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Northland lifestyle block sale prices have increased 27 per cent in the past year, with the 162 properties which changed hands for the three months ended March 2019 having a median sale price of $548,000, up from $430,000 a year earlier.

Real Estate Institute of New Zealand (REINZ) data show the Gisborne region (+92 per cent) and Southland (+28) exceeded the Northland price improvement over the same period, while West Coast lifestyle sale prices plunged (-45) and Auckland prices dropped (-9).

The median price for the 1612 lifestyle properties sold nationally during those three months was $680,000 and was $32,500 higher compared with the three months ended March 2018.

REINZ spokesman Brian Peacocke said: "The median price at $680,000 has eased from the $690,000 level recorded for the period ending February 2019 and, while it remains at a healthy level, interest rates and lending criteria as determined by the financial institutions will no doubt be influential in determining activity and prices in the forthcoming months."

Meanwhile, 33 Northland farms were sold for the three months ended March 2019 - five dairy, four finishing, 16 grazing, one arable and one special farm along with six horticulture properties.

There were 331 farm sales nationally in the three months ended March 2019, compared to 370 farm sales for the three months ended February 2019 (-10.5 per cent), and 388 farm sales for the three months ended March 2018.

The median price per hectare for all farms sold in the three months to March 2019 was $23,383 compared with $27,428 recorded for three months ended March 2018 (-14.7 per cent).

Peacocke said such price reductions indicate significant changes are occurring within a number of the land use categories apart from the horticultural sector, which while down marginally from the March quarter of two years ago, has experienced a 21 per cent lift from the sales volumes recorded for that sector in the March quarter of 2018.

Drivers for the drop in sales volumes included:

• An increasing number of retirements among farm owners.

• Pressure on profitability as a result of increasing costs.

• Increasing difficulty in obtaining qualified labour.

• Increasing demands from compliance issues.

• Indications of a lack of empathy from central government.

• Volatility of income and climate.

Peacocke said encouraging factors included:

• In spite of tightening criteria from the banking sector, interest rates and the exchange rate remain encouraging.

• Income levels are good for lamb and fine wool, solid for beef, improving for dairy and excellent for some of the horticultural products.

The five Northland dairy farms sold for the three months ended March 2019 had a median sale price of $11,786/ha, down from $17.741/ha in February and $15,286/ha in March 2018.

The median price for the 43 dairy farms averaging 124ha sold nationally for the three months ended March 2019 was $37,100/ha, compared to $33,750/ha for sales a year earlier.

The median price per hectare for dairy farms has increased 9.9 per cent over the past 12 months.

The four Northland finishing farms sold for the three months ended March 2019 had a median sale price of $26,929/ha, down from $28,506/ha in February but a nudge ahead of the $26,527/ha median in March 2018.

The median price for the 80 finishing farms averaging 40ha sold nationally for the three months ended March 2019 was $31,059/ha, compared to $30,044/ha for sales a year earlier.

The median price per hectare for finishing farms has risen 3.4 per cent over the past 12 months.

The 16 Northland grazing farms sold for the three months ended March 2019 had a median sales price of $11,869/ha, up from $9462/ha a year earlier.

The 117 grazing farms averaging 155ha sold nationally for the three months ended March 2019 had a median sales price of $10,373/ha.

The median price per hectare for grazing farms has fallen 2.9 per cent over the past 12 months.

The six Northland horticultural properties sold for the three months ended March 2019 had a median sales price of $179,229/ha, down from $200,299/ha a year earlier.

The 46 horticulture farms averaging 8ha sold nationally for the three months ended March 2019 had a median sales price of $240,064/ha, down from $277,901/ha a year earlier.