Rural property owners have received fantastic news from the Australian Bureau of Agricultural and Resource Economics (ABARES)[i], which reported that historically high dairy prices over the past three years have significantly impacted dairy farmland prices, surging by over 20% annually since 2020.

ABARES Executive Director Dr Jared Greenville said, “Gippsland dairy farmland has the highest price per hectare for Victorian dairy regions at over $41,000 per hectare in 2023, almost reaching the most valuable dairy farmland, Tasmania, at approximately $45,000 per hectare in 2023.

“Forestry farmland prices have risen by over 75% between 2019 and 2023.”

Dr Greenville said hobby farmland prices experienced a rapid increase in 2021 and 2022 as COVID-19 lockdowns eased. 

“Hobby farmland prices increased by an average of 10% per year between 2020 and 2023 to around $200,000 per hectare, compared to the growth in all broadacre farmland of 14.8% per year,” Dr Greenville said.

“Prior to this, the average annual growth rate in hobby farmland prices increased about 5.5% between 1992 and 2020.”

According to ABARES, farmland prices are important in helping better understand farm business performance and growth over time. The ABARES Farmland Price Indicator provides this vital information in an easy-to-access and statistically robust platform.

Travis Wentriro, Regional & Rural Network Manager at Raine & Horne, commented on the substantial increases in farmland prices across several categories:

“The significant growth of farmland prices clearly indicates that owning quality, well-located rural real estate is an excellent long-term wealth generation tool. 

“The data from ABARES underscores the value and stability of rural property investments. Whether it’s dairy, forestry, or hobby farmland, the consistent price rise reflects these assets’ enduring demand and profitability,” Travis said. 

“Investing in rural real estate not only offers potential for significant capital gains but also provides a tangible, resilient asset that can be the cornerstone of wealth creation for savvy investors.”

Travis added, “Given the recent significant growth, if you're thinking about selling a rural property, now might be the perfect time to act. Consider getting an obligation-free appraisal from a Raine & Horne Rural agent.” 

[i] https://www.agriculture.gov.au/about/news/strong-growth-dairy-forestry-hobby-farms