Farm sales have ground to a virtual halt as the slide in the all-important dairy payout has forced both banks and farm buyers onto the sideline. Nationwide farm sales slumped to 52 in July from 80 in June and 154 in July 2008, while dairy farm sales crashed 78% in July to 5 from 23 in July of both 2007 and 2008. Total July farm sales were 70% below the average July month for the previous four years. This compared to June sales being 60% below the previous four years' average and March sales being 62% below their average. The average drop in nationwide farm sales between the June and July months for the previous 6 years was 10.8%, but it was 37.5% this year. The Real Estate Institute of New Zealand (REINZ) releases farm sales figures for three month periods. Their figures show 229 farms sold in the three months to July from 285 in the three months to June and 601 in the July period a year ago. At interest.co.nz we also separate sales out for each individual month. There were 40 dairy farms sold in the REINZ's July period at a median price of NZ$3,419,104. This was up by NZ$400,000 from the June period when there were 55 sales, but down from NZ$4,200,000 a year ago when there were 89 sales. REINZ rural spokesman Peter McDonald said with the 40 dairy farms changing hands in the period, the national average price of NZ$41 per kilogram of milk solids and more than NZ$35,000 per hectare was a good result. McDonald said the average size of dairy farms sold in the period was 147 hectares with production on average of 904 kilograms of milk solids per hectare. "It's good to see the season finish on a consistent note," McDonald said. "Despite all the gloomy predictions, the average figures we're seeing are good news, especially combined with encouraging news such as the 25 percent increase in powder sales reported by Fonterra," he said. The REINZ median farm price for the three months to July was up slightly from June at NZ$1,200,000. It was down from NZ$1,800,000 in the July 2008 period.
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