Here we are again, ready to wrap up another year. A new year is always a time for fresh starts and new beginnings, so I’ll get right into it with our big news. Farmlands Real Estate has merged with Property Brokers, which is a really exciting way to end the year. With Property Brokers’ marketing expertise and resources, we can really boost our service and outcomes for shareholders. Not only that, shareholders can benefit from special rates and commission fees, so it’s very good news if you’re a vendor.
The market has been quietly active, if a bit subdued, this quarter. Auctions have had a low clearance rate lately, but deals are still being done if the property is a strong business proposition. There’s just a bit more negotiation involved to line up the vendor’s pricing expectations and the buyer’s ability to meet lending criteria.
Some will consider this a gloomy outlook, but I disagree. I see the market as being in a transition period from a capital gains market to one that’s driven by ROI and robust businesses. And if vendors have to make sure that their business is doing well to get buyers, then that has to be healthy for the industry.
I’m expecting this to go on for a few years while the process gets ironed out. The next several years should remain fairly steady, even with the Reserve Bank’s new rules. One way farmers could work with those is to put the extra cash from a good season into loans to keep borrowing down.
What I’m saying is that nothing’s really changed – if the numbers stack up, you’ll sell. It’s just that it’s very much a numbers game now, with prices and sales resting on the property’s ability to generate cashflow and pay down debt. There’s less emotional buying. And to be honest, I’d say that’s well overdue.
Things are looking great heading into summer. The growing season up to Christmas is probably the best it’s been for a long time. Moisture levels have been a bit low, but those big rains we’ve had over the last few days will improve things. Plus, payout levels are looking good and Fonterra looks like it’s finally heading in the right direction. Confidence is definitely improving and if the weather plays nice over the season, everyone’s going to be in much better shape than this time last year.
So that makes it a pretty good time to consider your listing for next year. We’re getting the best results from tender and fixed-price campaigns. They need a bit of patience and realistic expectations, but we get there in the end!
We hope you’re ending your year on a high. Remember that we’re always ready to have a chat about marketing campaigns and advise on the best strategies for your property.
Give me a call today on 027 492 5878 – or if you’d prefer to flick me an email to start, note that the address is now [email protected].
From all of us at Farmlands and Property Brokers, I’d like to wish you a very happy Christmas and a great start to the New Year.
Ian Morgan AREINZ