SUPPLY for Wimmera farmland can’t keep up with demand, a Horsham real estate agent says.
Harcourts Horsham principal director Mark Clyne said there was strong desire for purchasing farmland in the Wimmera – however, supply wasn’t keeping up.
“The demand has been strong for the past few years due to strong interest rates and a couple of really good farming seasons,” he said.
“There’s just not enough land to go around for those who want to invest.
“When land does come up for auction – and we always recommend that farmland should be sold by auction – it goes very quickly.
“Family enterprise farms are growing in size and they tend to hold on to land, passing it down through the generations.
“In other cases, but not all, land is sold to neighbouring farms, so there isn’t a lot of space for people wanting to buy in to the industry.”
Mr Clyne’s comments come after a Rural Bank report revealed that the median price of Victorian farmland increased by 9.5 per cent in 2017.
The Farmland Values report revealed a year-on-year increase of 1.7 per cent in the total number of farmland transactions completed across Victoria.
The total area of land traded increased by 11.7 per cent in 2017 compared to 2016, while the value of land traded increased by 10.1 per cent.
An estimated total of 1827 farmland transactions took place in 2017 across Victoria.
This equated to about 253,000 hectares changing hands for close to $1.2 billion.
North-west Victoria recorded the highest median value per hectare increase for the state in 2017 with a 21.6 per cent increase.
Other top performing municipalities included Yarriambiack, Buloke and Horsham shires.
Mr Clyne said farmland sales in the Wimmera had been quiet for the past few years.
“As a whole we probably had the lowest amount of farmland sold last year for quite some time,” he said.
“Families have a very tight hold of land. Certainly farmers looking to expand have been advised by financial advisers to look at other commercial investments.
“These family farms have become almost like huge business enterprises; farming has certainly changed a lot in the last 20 years as new technology and equipment has become available.”
Rural Bank managing director and chief executive Alexandra Gartmann said the report results reinforced the high value of and demand for Victorian land.
“Volatile climate and market conditions characterise farming across the country, and as a result it is inevitable these – alongside many other factors – will contribute to fluctuations in farmland values,” she said.
“This volatility was particularly evident in north west Victoria, where favourable seasonal conditions led to an increase in demand for the tightly held regions of the Wimmera and Mallee.”