DAIRY farms aren't tipped to reach the high prices of 2008 but the market is picking up, writes SIMONE SMITH
Real estate agents have reported a renewed interest in dairy properties, but there is little chance land prices will climb back to the peak of 2008 in the near future.
This comes despite agents reporting international and corporate buyers recently showing strong interest in the Riverina and northern Victoria.
Sellers wanting more than $24,710 a hectare - 2008 prices - in the current climate were in "la la land" one real estate agent told The Weekly Times, because there is "general buyer resistance to paying that sort of money".
Nevertheless, some properties have been selling, and more dairy farms have come onto the market.
Elders Camperdown and Mortlake real estate manager Rob Rickard has sold a few dairy properties in recent months, ranging in size from 121ha to 283ha, to mostly local buyers.
"There has been quite a bit of action from adjoining land owners, people fairly close-by looking to expand (also) it is an opportunity for people who have sold properties elsewhere to relocate to the area," Mr Rickard said.
"We are fielding quite a lot of inquiry out of Queensland, NSW (and) northern Victoria, people looking to get in (to this region) while the market is a bit flat."
Colac-based Charles Stewart and Co rural real estate manager Anthony McDonald said there had been a small increase in properties listed on the market, and a 20 per cent increase in online traffic.
However, the overwhelming concern of vendors is who will buy the farms.
"We are going to probably be even more reliant than we have been on immigration, people coming into the industry choosing to come and start in Australia because the younger brigade, they are not there," he said.
"So we are looking for people who have resources and capital who want to invest in Australia."
Mr McDonald said farm values had dropped about 15 per cent compared to the peak in 2008 and the strong Australian dollar had limited New Zealand investment in the region.
A stronger milk price and the availability of irrigation water has sparked a renewed interest in northern Victoria and the Riverina.
Properties have started to sell in the north, thanks to confidence in the climate and dairy industry, but prices won't get up to the peak of 2008 in the short term according to Dairy Livestock Services rural property specialist David Pemberton.
"There is a little bit more inquiry from corporates', it had been quiet for the last six to 12 months, (but) we are starting to get a bit of inquiry for bigger farms," he said.
"It has picked up (the property market) in New Zealand and it generally follows (in Australia)."
Sale-based Leo O'Brien Property managing director Leo O'Brien sold a dairy farm recently and said "genuine inquiry" started on dairy properties up to three months ago.
Most interest has come from locals, however, Mr O'Brien said he has had inquiry from southeast South Australia and other parts of Gippsland.
"We are in an interesting position where there are still big prices in people's minds from a couple of years ago (but) with few buyers," he said.