Prices for rural property may surge
Last week's $5.1 million auction sale of North Taranaki's Rerekapa Station, a likely record price, may herald a surge in Taranaki rural real estate sales.
The price tag for the station near Uruti is believed to be a record for a Taranaki hill-country farm.
The successful auction followed the sale earlier this month of the 1427 hectare Te Kawau Station at nearby Tongaporutu for more than $4m.
On the dairy scene, a 75ha South Taranaki farm fetched $3.26m at auction earlier this month - equal to $44-$45 kilogram milksolids (MS), a figure that's nevertheless well below $65kg MS that Taranaki dairy farms were reaching in 2008.
A nearby 29ha runoff sold for $1.21m - above prediction.
On Friday a 71ha dairy farm near Inglewood made $3.08m at auction - also the expected price.
One rural real estate agent estimates current farm listings are twice what they were last year, but another is adopting a wait-and see-attitude to sales.
Taranaki Daily News advertising manager Matt Surgenor said rural property listings are significantly higher than last year.
First National Allied Farmers agent Owen Mills, of Stratford, said the period between the beginning of October and Christmas was traditionally the farm sales peak.
This year he has noticed some first-time farm buyers, such as sharemilkers with financial backing, looking for dairy farms in the $2m-$3m bracket. "We're seeing the more established sharemilkers looking to buy," he said. "Right now conditions to buy are very good."
Low interest rates and prices seemed settled and the banks were showing more interest in lending money on deals they could see would work.
"The listings are there, the buyers are there, the money's there and interest rates are good."
McDonald Real Estate principal Peter McDonald, of Stratford, said while there was a lot of listings, there were few confirmed sales.
He thought the market was in catchup mode, with the number of listings similar to what they were in 2008-09.
"It seems exceptional, but that's because the last two to three years have been quiet."
Sales were below the traditional level of 15-20 at this time of year, but inquiries were strong.
Money was on offer at interest rates under 5 per cent. "The only real positive is that they're powering the market along," he said.
Taranaki Daily News