Victoria’s farm prices slump revealed

New figures have detailed how Victorian and Tasmanian farmland values have struggled amid dry weather and falling farmer confidence. See the details.

Farmland values across Victoria and Tasmania fell by about 8 per cent from the first quarter of this year compared to the first quarter of last year.

Victorian farmland values have slumped in the past year, following unfavourable seasonal conditions that dented farmer confidence and willingness to expand their landholdings.

The Victorian-Tasmanian rural property indicator fell by 8 per cent year-on-year to a median price per hectare of $14,198, new figures from the Elders Rural Property Update 2024 quarter one report revealed.

Compared to the final quarter of the 2023 calendar year, there was also a 15 per cent drop in the value of the Victorian-Tasmanian farmland values, which wiped out most of the gains made last year.

Victoria’s southwest and south central regions recorded the largest falls in value, with both falling to a median price per hectare of about $15,000 a hectare.

Sales volumes for rural property in Victoria and Tasmania also remained at historically low levels with just 220 sales recorded in the first three months of this year.

Elders general manager farmland agency and water Mark Barber said a dry end to last year was a key factor in the declining farmland values recorded this year as buyer demand faded.

“The market has been underpinned by good quality commercial and corporate sized transactions which have sold well to strong inquiry,” Mr Barber said.

“Activity at the other end of the market has been more subdued with a greater proportion of deals subject to debt funding coming under increased scrutiny by financiers and attracting subdued buyer inquiry.

“Poor seasonal conditions at the start of the year in some southern areas saw a reduction in farmer confidence leading to quarter-on-quarter declines in values across southern states.

“However, this must be seen in the context of very high rates of appreciation across this

region over the last three years where property prices have increased by 11.7 per cent, per year.”

National farmland prices remained stable reaching a median price per hectare of $10,388, a 3 per cent increase year-on-year.

In NSW the median price per hectare increased by 9 per cent year-on-year to $10,042, buoyed by strong summer and early autumn rainfall, despite less favourable conditions across the southern parts of the state.

Farmland values in South Australia were also subject to their own set of seasonal circumstances, remaining stable at a median of $8998 a hectare.

“After many years of consistent underlying land growth across all regions, small

corrections to averages were observed in the Q1 of 2024,” Elders South Australia states rural sales executive Adam Chilcott said.

“With the warmest March in South Australia ever recorded, buyer participation was cautious and more considered, than in recent times.”