Rural property market strong heading into busy spring season

Rural property market strong heading into busy spring season

Property
Tom Hutchinson is selling a property that's been in his family for almost 200 years in Victor Harbor, SA. Photo by Charles Lynch.

Tom Hutchinson is selling a property that's been in his family for almost 200 years in Victor Harbor, SA. Photo by Charles Lynch.

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Demand for rural property in the southern states has stayed firm despite the overall property market taking a hit because of coronavirus.

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Demand for rural property in the southern states has stayed firm despite the overall property market taking a hit because of coronavirus.

And there's optimism that this will continue into the busy spring selling months.

Ray White Woodside, SA, principal Angus Campbell credited the firm market to the overall positive sentiment towards the Australian agriculture industry.

Mr Campbell said for the 2019/20 financial year, demand for rural property in SA was firm to slightly stronger, and coronavirus hadn't appeared to have caused any significant negative impacts.

"We saw the opposite trend to what our city cousins were experiencing in the residential real estate arena; they were struggling whereas we were in demand," he said.

"And we think it's because we've found that demand for commodities on a global basis has been firm to strong and continues to grow due to the brand position of Australian products."

He said another reason for this was that with isolation came people thinking about their futures and living situations.

"People sat in their homes and deliberated where they were currently positioned and as a result, they thought about their aspirations and where they wanted to be," he said.

"Our online inquiries doubled and that resulted in a portion taking action."

He said the buying gallery ranged from families in Adelaide looking to reposition themselves to country towns to international investors looking to get in the market.

And he expects that to continue.

"I don't see any reason why the aspirations of people to live in spacious, beautiful surrounds would change," he said.

"And I don't see why the international market wouldn't continue to snap up as much of our productive land as possible."

For Tom Hutchinson, listing a property that had been in his family for almost 200 years during a pandemic wasn't overly intimidating.

While Mr Hutchinson said he changed his mind a couple of times before deciding to put it on the market, he said he knew the sort of person that would be interested in buying his 91-hectare parcel at Victor Harbor, SA, wouldn't be the sort of person that was overly worried about money at the moment.

"There was concern at the height of COVID-19 during lockdown that nothing was happening and people were living in fear, but once things started to ease up in SA we were happy to put it on the market," he said.

"It's very easy to be negative but if you think positive and you have the money, there are definitely opportunities out there."

He said he had to put his emotions aside when deciding to sell the historic property.

"I am looking to fund my retirement and I need a bit more money to do that, so I was looking at it purely as a business decision," he said.

"If you keep looking back, you'll get a sore neck; you've got to look ahead to what you need in the future.

"It comes down to making a pragmatic business decision and the emotions have to be pushed aside."

READ MORE: Fleurieu property hits market for first time in 200 years

Elders Real Estate general manager Tom Russo said they had seen a 20 per cent increase in their volume of transactions last financial year compared to the same period last year.

"I think the strongest trend is the supply and demand dynamic that's happening; we're seeing demand outstrip supply," Mr Russo said.

He said the market was particularly buoyant in southern Australia where there was higher rainfall.

And looking forward, he said he couldn't see values going backwards as they headed towards their busy spring selling season in the next couple of months.

"There are a lot of local buyers who are seeking to buy properties in the district," he said.

"There is also still the weight of capital coming from investment firms, whether they're large corporate farmers, sovereign wealth funds or investment managers who are backed by foreign or institutional capital; they're all still very active and see agriculture as an attractive option."

He expected more properties to start coming onto the market in August.

"It's a sellers' market and that will motivate people to sell," he said.

"The market is buoyant so those people thinking of selling in the short to medium term are realising now is a good time to present their property to the market."

He said there would need to be a significant swing in listing volumes to see prices come off.

"There's been an explosive level of price appreciation in the last few years and it's not sustainable for prices to keep going up at that high rate, so there will definitely be a reduction in the rate of appreciation [at some stage] but I can't see values going backwards," he said.

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The story Rural property market strong heading into busy spring season first appeared on Farm Online.

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