Research
Australian farmland price outlook 2024: Cooling down as rationality returns
The median price per hectare for farmland in Australia increased by 11% year-on-year in 2023. Arable land values are booming, up 20%, while grazing areas plateaued, slipping 0.3%. Total sales of all farmland types approached 3 million hectares in 2023. We analysed the year’s sales activity to develop a picture of the latest farmland values across all regions in Australia.
In 2023, the median price per hectare of Australian farmland increased by 11% YOY for all land types nationwide. The value of arable plots rose by 20% YOY, dairying land increased 22%, and grazing land was virtually stable, down 0.3%. This represents AUD 9,350 per hectare for arable land and AUD 8,800 for grazing areas. Large deals have slowed down, with sales above AUD 10m showing a reduction of 33% YOY. In general, 6% of arable land and 10% of grazing land sales exceeded AUD 10m, according to our data set.
Demand for farmland is changing behaviour. Buyers are more focused on finding the right land value for their money and spending more time on due diligence process. Rabobank’s Q1 2024 survey shows that farmers’ purchase intentions decreased to 6% YOY, compared to 7% last year. The income outlook for 2024/25 is positive, with prices still slightly above the historical average for agricultural commodities. The weather forecast is a point of attention, as some regions are coming from a deficit in late 2023.
The outlook for land prices in 2024 forecasts further growth, though rather small year-on-year. Following better cattle prices and an improved market outlook, grazing areas should partially recover their growth pace. The long-term view for land prices for 2024 to 2029 indicates a slow and gradual reduction in the growth rate, as buyers are looking for the best value for money.