Victoria’s farm prices slump revealed

A new report has shown Victorian and Tasmanian farmland values have dropped by more than 10 per cent amid dry weather and falling buyer confidence.

Victorian and Tasmanian farmland values dropped significantly last year, a new report has revealed, as confidence in the states’ rural property market was hurt by a sustained run of dry weather.

The Victorian-Tasmanian rural property indicator for the third quarter (July, August and September) last year was a median price of $14,142 a hectare, a 13 per cent decline in value compared to the same quarter in 2023, the latest Elders Rural Property Update showed.

Across the three-month period $249m of farmland was traded, a 38 per cent reduction year-on-year, following a 30 per cent reduction in sales, which fell to 176 transactions.

“Prices across most VIC-TAS regions were lower with only values in the South-West and Gippsland bucking the trend,” the report said.

“There were some particularly heavy falls in property values across North-East Victoria. Most predominantly cropping districts suffered further falls on the back of falls in previous quarters, in part due to adverse seasonal conditions.

“There has been some slowing in active property listings across VIC/TAS over the past few months.

Victorian and Tasmanian farmland price have decreased to a median price of $14,142 a hectare, a 13 per cent decline in value. Picture: Zoe Phillips.

“Falling property values have generated some sales activity as they have improved the economics and brought some buyers back to the market. The sustained dry weather has seen days on market tick up as confidence erodes.”

Despite declining farmland prices in Victorian and Tasmania, nationally values stabilised, underpinned by significant growth across Queensland and the Northern Territory.

In the third quarter of last year, the national price per hectare was $10,567 a hectare, a 1 per cent decrease year-on-year following $2.537bn worth of farmland sales.

In Queensland-NT, the price per hectare increased by 16 per cent to $9262 a hectare for the quarter, as with weaker values recorded in the north and west of Queensland, but higher values in central and southern regions.

Across NSW the price per hectare remained stable year-on-year at $10,065, a 1 per cent decrease.

Meanwhile drought conditions throughout much of SA have hurt farmland values, which have fallen by 18 per cent year-on-year to $8791 a hectare.

“After a long run of good seasons, rising land prices and record results, the dry spell has seen momentum shift. Property price expectations must be realistic, to achieve a sale outcome in the current environment,” Elders South Australia state rural sales executive Adam Chilcott said.

However, across the Nullarbor farmland values spiked 23 per cent to a median price of $10,054 a hectare following $155m worth of farmland sales.

“Picking general trends is quite challenging in the current environment. There are limited properties available in most areas with many farm sales continuing to set record prices per hectare for their respective regions whilst other properties can be slower to move,” Elders Western Australia real estate sales manager Simon Cheetham said.

The Elders rural property update used Corelogic data from sales greater than 40ha, except for Tasmanian properties where transactions more than 30ha are included.

Originally published as Victoria’s farm prices slump revealed