Reliability drives land prices

Reliability drives land prices


Local Business Feature
HOT PROPERTY: New buyers to enter the property market on the Yorke Peninsula, with demand for the region's reliable land sky-high. Pictured is a property Point Riley Road, Wallaroo. Photo: RAY WHITE COPPER COAST

HOT PROPERTY: New buyers to enter the property market on the Yorke Peninsula, with demand for the region's reliable land sky-high. Pictured is a property Point Riley Road, Wallaroo. Photo: RAY WHITE COPPER COAST

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Reliable land, high yields and rainfall, and a desire for farmers to expand their operations are among the reasons why breaking into Yorke Peninsula’s rural property market is tough, real estate agents say.

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Reliable land, high yields and rainfall, and a desire for farmers to expand their operations are among the reasons why breaking into Yorke Peninsula’s rural property market is tough, real estate agents say.

Ray White Copper Coast principal/sales agent David Bussenschutt said properties in the region were tightly held and many were sold “over the fence”, which made it difficult for newcomers to enter the market.

“There are often pre-existing arrangements with neighbours where a farmer will agree to sell land to a neighbour when they are ready to put it to market,” he said. 

“Farmers in the region tend to build up farms when land is available near them. This way, they could easily move machinery between neighbouring paddocks, instead of buying a second set of machinery to service a parcel of land in another area.

“It means the newly acquired land is an extension of their farming without too many extra costs.”

Mr Bussenschutt said the agency had a list of people on its books waiting for land to become available near them.

Part of this was because land was so tightly held.

"It is rare for land to transact more than once in a person’s lifetime," he said. “If a farmer really wants that paddock next to them, they will pay a premium to get it.”

Among the qualities offered in the YP were loam soils and good rainfall.

Prices fluctuated somewhat upon location. For example, properties north of Kadina were often lower than those south of the town, with this mainly due to the way the rainfall amounts tend to drop off north of Goyder's line, along with the lighter soils.

Landmark Harcourts real estate specialist Wayne Hickman had a property at Curramulka sell at auction for $16,403 a hectare in October.

The two highest bidders for that property had missed out on an opportunity to buy similar land in the YP that was sold as an expression of interest a few months earlier.

Mr Hickman said land prices had an upward trend. 

“I sold a very similar property three years ago and it averaged $4940/ha less. It’s gone up 30 per cent,” he said.

Mr Hickman echoed Mr Bussenschutt’s comments about qualities that made YP property so attractive, and it was common for farmers, particularly in Yorke Valley near Maitland, to sell to neighbours in pre-arranged agreements.

“Leasing is also very popular in YP. In the right area, some people were paying up to $600/ha to lease,” he said.

“Those that want to buy have to prepare to get out of their comfort zone to secure the land when it becomes available.”

Mr Hickman said higher prices were generally sought in the middle of the peninsula to the south of Minlaton as it offered higher ground, rainfall and yields compared to land along the coast.

He will watch the prices of lentils, as he said that may influence the prices of land sold.

“If lentil prices keep going backwards, it may drive down property prices,” he said.

“But I wouldn’t expect land prices to crash; they might stabilise before they take off again.

“Lots of people are in a wheat-lentil rotation; they almost complement each other.

“People were getting $2000/ha from lentils in 2015, but prices are down to $600-$700/ha.”

“Lentils on the right land will grow well. The less favoured land around the coast have not grown as well.”

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