SILLY PRICES, or prudent long term investment?
The rural property boom dominating the real estate market in the Central and lower North Island is demanding an answer to an increasingly asked question ? when will the bubble burst?
In the past three months three rural real estate agents in the Wanganui/Waimarino area
have sold nearly $30 million worth of farmland between them, but more importantly it is the prices many of these farms fetched.
The latest sales highlight the extent of the boom.
Two Taihape farms set new benchmark prices for the area just over a year after floods ravaged many rural properties. One was a 348-hectare hill country property on Tiriaukawa Rd, which sold for $612 per stock unit.
Earlier, a 253-ha sheep and beef breeding and lamb fattening unit on Makopua Rd, just over 20 kilometres from Taihape, sold for $553 a stock unit. Both fetched record prices for the types of units they were The two farms are among $10 million sold by Bayleys Realty Group's Taihape agent Peter Stratton alone in the Waimarino over the past three months.
Add to this impressive result the efforts of fellow Bayleys group Taihape agent Jamie Proude, who also topped the $10 million mark over a similar period, and Wrightson Wanganui agent Steve Carkeek's $7 million, and we have the makings of a boom.
The rural market in the Wanganui/Waimarino/Rangitikei/South Taranaki districts had been in the doldrums for several years. In fact, between January and October 2004 there were no farms on the Bayleys' books to sell ? a couple of lifestyle blocks, but no large farms.
But this year began with a rush. Five farms sold at auction earlier in the piece, while another two went by tender.
They were rapidly followed by a 134-hectare unit in the Mataroa district, 12lm from Taihape, for $1.4 million.
Then The Gloaming, a 73ha property at Wainui Junction 6km from Taihape, fetched $1.2 million. Donmore, a 197ha Taihape farm, followed with the price far exceeding expectations. Locals bought this for $2.11 million.
A 95ha horticultural and fattening farm at Ohakune fetched record money for bare land in that district - $1.71 million was paid and at $18,000 a hectare a new benchmark was set.
Closer to Wanganui, the Hyland's 890ha hill country farm on the Parapara fetched a massive $5 million.
