Demand for rural property in Victoria was currently outstripping supply, according to leading agents.
Low interest rates, a favourable exchange rate, good seasonal conditions and buoyant commodity prices have led to “all the stars aligning,” according to Ray White Rural Melbourne Associate Director, Tim Gladman.
“The Victorian rural property market is booming, with significant increases in both transaction levels and land prices - besides the numerous publicly listed farms that have recently been sold, there are also many sales occurring off market,” Mr Gladman said. “Demand for rural property in Victoria is currently outstripping supply leaving many unsatisfied buyers - interest is widespread from local farmers, city based private investors and domestic and foreign institutional money.”
Demand for rural property in Victoria is currently outstripping supply leaving many unsatisfied buyers.Tim Gladman, Ray White
He said over the past 18 months, rural property values had risen by between 20 to 40 per cent, with the only exception being dairying land, which was still “quite subdued.”
At CBRE, Agribusiness senior manager James Beer said his company recently sold two large corporate scale western Victorian properties. Kaladbro, via Strathdownie, a highly productive 2,632-hectare landholding sold for $24m to the Brinkworth Family, at a value of more than $9000 per hectare for land and water. CBRE also sold Cheviot Hills, via Penshurst, to MH Premium Farms for $10.25m, which equated to over $5,250 per hectare.
Charles Stewart director, Nick Adamson, Warrnambool, agreed demand was strong, on the back of a good season.
“Red hot red meat prices, low interest rates, a stable dollar, the appetite for the clean, green food Australia can produce are driving the market,” Mr Adamson said. Properties were being sought by neighbouring farmers, who wanted to consolidate, to larger operators. “The corporate sector is still very bullish, especially in livestock and cropping.”
Mr Adamson said across the cropping and grazing areas of western Victoria, the benchmark value for most land was $7000 a hectare. “I get the feeling, particularly now prices are buoyant, beef farmers want to have a bit of their own time in the sun.”