Elders Rural Property Update has been released this week, analysing the movement of rural property values for quarter one of 2023, from January 1 to March 31. In this edition we focus on the one year rolling performance for the period between April 1 to March 31.
The update found that land prices across the country remained firm driven by continued tight supply.
Elders General Manager Farmland Agency & Agribusiness Investments, Mark Barber, said that while buyside drivers had softened, demand remained high for a lower volume of quality properties.
“Whilst there has been some short-term softening in commodity prices, other factors are likely to start driving further demand for land. As noted in previous editions, we are seeing increased demand for carbon credits and renewable energy, both of which are land intensive. We’ll be continuing to report on the impacts of these emerging drivers in future editions.”
Key points:
- The 1yr rolling national median price per hectare (ha) increased by 1.9 percent (pc) to $7,852/ha.
- 1yr rolling transaction volume declined by 6pc to 6,344 totalling $13.7 billion.
- The five-year compound average growth rate (CAGR) was 8.9pc to the end of March 2023, indicating the median price per hectare is doubling every 8.1 years.
At state level the 1yr rolling median price per hectare increased by 5.7pc in South Australia the largest increase of any state. Phil Keen, Elders State Real Estate Manager for South Australia said cropping properties continue to push the market.
“Cropping areas continue to perform strongly with examples of record prices in some areas. Grazing property demand has slowed driven by softer livestock prices. We have seen some hesitation with potential sellers going to market despite close to or record high land prices.”
In other states growth for the quarter lower, but still strong, Queensland and New South Wales increased by 2.3pc and Victoria increased by 0.6pc. Meanwhile in the Northern Territory and Tasmania the median price per hectare eased by 8.1pc and 6.9pc respectively, largely driven by structural factors stemming from low transaction volumes.
Elders source transactional level data for every rural property sale above 40 hectares in Australia from Corelogic before undertaking in-depth analysis to remove non-agricultural land uses and statistical outliers. Analysis and commentary is provided by Elders’ national network of rural real estate experts.
Sources: *Corelogic, **Yahoo Finance