Peter Newbold, general manager of PGG Wrightson Real Estate and Jamie Mackay from The Country have just had their monthly catch-up regarding the state of the rural property market.

First off, Jamie wonders whether carbon farming is distorting the sheep and beef property market. Peter says it is and in a big way - as much as 50%. It's having a big impact on traditional buyers, young farmers starting outand existing farmers looking to grow their holdings. And a lot of sales at a certain level are going to off-shore buyers.

What about interest rates? Peter agrees higher interest rates are having an effect across the board - but less so in the rural sector. The biggest impact is on values. Vendors really need to look at their expectations as buyers are not going to overpay. It all depends on the region and the sector but there's definitely some revaluing going on.  

Jamie points out that sheep and beef property values, especially on more marginal land, are probably being insulated by carbon farming and forestry.
But what about dairy? Peter says dairy is looking really good and prices being achieved are in line with last year. In the "sweet spot" - between 5 and 10 million dollars - there's quite a bit of activity. Some vendors are looking at splitting up larger dairy properties.

Jamie turned to the horticulture sector where there have been a few issues, like labour shortages, disease and difficulty with shipping. Peter says the horticulture sector has been slower than expected with some pressure on values. There are lots of buyers but they're not prepared to pay last year's prices - something vendors should bear in mind.

Looking at lifestyle properties, Jamie reminds us they were all the go post pandemic as people wanted to get a bit of space away from other people.  
Now the market has taken a U-turn. Peter points out there are probably more quality lifestyle properties on the market right now. But the peak was a year ago. The prices achieved then you will not get today. A lot of this is down to interest rates and vendors need to be realistic.