Canterbury | September 2020
Demand for arable property in Canterbury was steady throughout the end of 2019 and 2020 as demonstrated by the number of sales that have occurred.
Buyers are predominantly neighbouring or nearby farmers that are increasing their land holding. To date liquidity has existed more commonly for properties in the 100 to 250 hectare range with few buyers for larger properties due to the reduced availability of capital.
Recent transactions demonstrate that some demand exists from purchasers with the financial strength to buy larger properties that are strategic purchases for a particular reason.
The market remains focused on the core physical resources, which includes the quality of the soils, the cost of irrigation water and type of irrigation, as well as the quality of the farm infrastructure.
Purchasers expect a farm to be compliant with Land and Water Regional Plan rules and Farm Environment Plans to be completed. Evidence of nutrient loss reductions and modelling to show how this will be achieved or possible alternative land use options are also likely to be considered favourably.
The recently announced National Policy Statement for Freshwater Management 2020 is generating discussion in the market, although perhaps more so for sheep and beef farmers.
We believe Canterbury is ahead of other regions in understanding environmental regulation and compliance and what this means for a farming operation.
Being part of an irrigation scheme with assistance provided with environmental regulation and compliance is viewed positively by the market in our experience. This is particularly true in the lease market with strong enquiry and lease rates achieved.
If you require further information on any of the sales analysed or the lease market, please do not hesitate to contact our team.
