Demand for land drives value

FARMLAND values in Bass Coast and South Gippsland continued to increase in 2017, a trend replicated across most of the state.
Last year in Bass Coast Shire, the median price per hectare was $16,144, nearly $2000 up on the three year average of $14,164.
There was an estimated 26 farm sales in Bass Coast in 2017, while in South Gippsland there was 103 estimated sales.
South Gippsland’s median price per hectare in 2017 was $12,982, just $700 up on the three year average of $12,290.
In Gippsland last year, the median price of farmland increased by 15.4 percent, well above the state average of 9.5 percent.
According to Rural Bank’s third annual Australian Farmland Values report, in 2017smaller blocks in Gippsland sold at a premium price.
Some were purchased as additions to existing farms, but in the 30 hectare to 50 hectare market, there was a higher percentage of lifestyle purchases.
Leongatha Alex Scott and Staff agent Peter Dwyer said there had been good enquiry for all types of grazing blocks, dairy blocks and farms.
“Apart from a bit of a dry autumn this year, the past two years have had fairly consistent seasons which has helped demand generally,” he said.
“Cattle prices are also holding pretty steady.”
Mr Dwyer said interest in South Gippsland comes from various areas.
“We have had enquiries from East Gippsland for grazing blocks and local interest is good too. It is a big area with some big farmers, so a lot of people are looking for a bit more land,” he said.
“I think our country is still good value. It is a good region to come to with good rainfall and it is close to the metropolitan area.
“All these things help to keep demand high.”
Chief executive officer of Rural Bank Alexandra Gartmann said the results of the 2017 report underlined the inherent value of Victorian farmland, while reinforcing the importance of taking a long-term view.
“Volatile climate and market conditions characterise farming across the country and as a result, it is inevitable these – alongside many other factors – will contribute to fluctuations in farmland values,” she said.
“Overall, buyers in the market exceeded supply in 2017, and with strong commodity prices and record low interest rates expected to continue, demand for Victorian farmland is set to remain strong.”

Going up: Leongatha Alex Scott and Staff agent Alan Steenholdt at a Nerrena Road property of 142 hectares on the edge of Leongatha. Farmland values in South Gippsland have increased over the past year.

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Posted by Sarah Vella on Jun 13 2018. Filed under Rural News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry