South Australia (-1.9%) and the Northern Territory (-6.4%) Compared to the the Ag Answers Australian Farmland Previous Year

A anuSTrali farmland values 2015 INT RODUCTION

The value of land underpins farming The median farmland price increased in businesses and rural communities. Tasmania (+12.8%), Queensland (+3.3%), Understanding farmland values is important New South Wales (+10.2%) and Western to everyone in agribusiness, especially Australia (+10.6%), but fell in Victoria Australia’s farmers. (-2.3%), South Australia (-1.9%) and the Northern Territory (-6.4%) compared to the The Ag Answers Australian Farmland previous year. Values 2015 report is based on actual farm SOUTH sales since 1995 using data collected by In all states, the median price has trended the official government agency in each higher over the past decade with average state and territory, which is then compiled annual growth exceeding 3% in most by APM PriceFinder. states. As inflation has run at 2.8% over the AUSTRALIA same period, this indicates real growth in The analysis draws on more than 220,000 farmland values. Although the median price transactions over 20 years, accounting has remained high over the past decade, for 264 million hectares of land with a the number of transactions** has trended combined value of $124 billion. lower.

The national median* farmland price Extend the investment horizon to 20 years South increased by 5.3% in 2015. This follows and the farmland value growth picture Australia a 6.8% increase in 2014 and a 2.2% becomes better still, with the median price 5.6% decrease in 2013. in most states recording average annual growth above 5.5%. The performance of farmland prices Average in different states was mixed in 2015. annual growth Y&MN 6.6% over 20 E years 7.1%

Farmland performance (average annual growth) A&F 5.9% 2015 -1.9% 5 years 0.0% 10 years 1.7% SE 20 years 5.6% 4.4%

E Eyre Y&MN Yorke & Mid North A&F Adelaide region and Fleurieu SE South East ABOUT THE RESEARCH STATE PERFORMANCE SA

Farmland prices are a function of many The prices used in the report are based on The median price of South Australian variables including, but not limited to rainfall, the total sale price and therefore include farmland decreased by 1.9% in 2015. Median farmland price – SA Annual median farmland price growth – SA Estimated number of farmland This follows an increase of 5.2% in 2014. transactions per year – SA location, agricultural industry, productivity, the value of capital improvements. Growth 3,500 50% 1,200 land quality, sentiment, interest rates, in values may reflect an element of capital 3,000 There have been three distinct periods of 40% 1,000 commodity prices and the performance of improvement on properties. Similarly, if growth in the median farmland price: 2,500 the wider economy. To isolate the reason water entitlements are attached to a land 30% 800 • Values grew steadily between 1995 2,000 for a particular movement in the median title and sold with the property the value of 20% 600 and 2002, with average annual growth 1,500 price for a region is complex. Therefore, the the water will be included in the sale price. of 4.5%. Median price ($/ha) 1,000 10% 400 focus of the report is to describe regional If water entitlements are sold separately 500 • Rapid annual growth of 13.7% occurred 0 200 and state trends more so than the drivers from the land, this value will not be captured 0 -10% 0 behind the observed trends. in the sale price. between 2003 and 2008. 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 • Since 2008 the median price has been 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 The report is a guide to the market value *The report uses medians to provide a stagnant with annual growth of 0.2%. trends of commercial farming property and measure of the mid-point of farmland prices The number of farmland transactions increased is not intended for use as a valuation tool. as a guide to market activity. Compared Median farmland price – SA Annual median farmland price growth – SA Estimated number of farmland by 5.1% in 2015. The number of transactions A qualified professional is required to with an average, the median is not as readily transactions per year – SA 3,500 has increased in the last two years from a low 50% 1,200 assess the value of a property. distorted by unusually high or low prices. 3,000 of 555 in 2013 to 678 in 2015. 40% 1,000 Even so, in areas where there have been 2,500 Adelaide and Fleurieu Peninsula South East Eyre Peninsula Yorke Peninsula and Mid North This analysis tracks the median price of A rise in the number of transactions drove an 30% 800 very few sales, the results should be viewed 2,000 14,000 250 3,000 450 1,400 140 14,000 400 increase in the total area of farmland traded, commercial farmland in dollars per hectare with caution as the year-on-year change 20% 600 400 12,000 350 1,500 12,000 2,500 1,200 120 200 by eliminating, where possible, metropolitan up to 210,000 hectares. This is the largest 350 10,000 300 in median price may not be indicative of an Median price ($/ha) 1,000 10,000 10% 400 100 1,000 10,000 and small block sales, as well as sales area traded since 2003 and represents 2,000 300 250 actual change in farmland value. A higher 500 150 approximately8,000 1.7% of improved farmland in 0 200 250 800 80 8,000 where one party has compulsory powers. 1,500 200 proportion of lower-priced sales can result 6,000 0 South Australia.6,000 200 600 60 Further, small farms are excluded to limit -10%100 0 150 in a lower median and vice-versa. 1,000 150 4,000

1995 1997 4,0001999 2001 2003 2005 2007 2009 2011 2013 2015 400 40

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 100

1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 4,000 the impact of ‘lifestyle farming’ on the The total value of farmland traded in South 50 100 2,000 500 200 20 50 results. **Farmland sales volume is reported as the Australia reached a new high of $414 million 50 2,000 0 0 estimated number of transactions. Farms in 2015. 0 0 0 0 0 0 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 As property settlement periods vary, 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 are sold as singleMedian or farmlandmultiple price lots, –which SA AnnualImprovement median farmland in median price values growth was– SA Estimated number of farmland some 2015 sales will not be captured in transactions per year – SA obscures3,500 the view of the number of farms 50% strongest on the Eyre Peninsula (+24.4%), 1,200 this report at the time of publication. The Median price $/ha (LHS) Number of transactions (RHS) Median price $/ha (LHS) Number of transactions (RHS) Median price $/ha (LHS) Number of transactions (RHS) Median price $/ha (LHS) Number of transactions (RHS) sold,3,000 particularly in cases where one farm followed by the Adelaide region and Fleurieu median price for the most recent year is a 40% 1,000 is 2,500sold as multiple lots to multipleAdelaide buyers.and Fleurieu Peninsula Peninsula (+8.5%). Median valuesSouth on Eastthe Eyre Peninsula Yorke Peninsula and Mid North preliminary one and will be revised at least 30% 800 Accordingly,2,000 the14,000 ‘number of transactions’ 250 Yorke Peninsula,3,000 in the Mid North and the 450 1,400 140 14,000 400 annually. 20% 600 12,000 should1,500 not be interpreted as the number South East declined in 2015 (refer charts on 400 350 12,000 2,500 1,200 120 200 next page). Nevertheless, the long-term trend 350 10,000 300 Median price ($/ha) of1,000 farms sold and10,000 should only be used as a 10% 400 100 1,000 10,000 across the state2,000 has been one of growth. 300 250 guide500 to market activity. 150 8,000 0 200 250 800 80 8,000 1,500 200 0 6,000 6,000 Farmland values are based on all farmland 200 600 60 -10%100 0 150 (including improvements),1,000 not just arable land. 150 4,000 1995 1997 4,0001999 2001 2003 2005 2007 2009 2011 2013 2015 400 40 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 100 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 4,000 50 Due to the structure of land ownership and a 100 2,000 500 200 20 50 lack of data, the arid areas of South Australia 50 2,000 0 0 0 0 are not covered0 in this report. 0 0 0 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015

Adelaide and Fleurieu Peninsula South East Eyre Peninsula Yorke Peninsula and Mid North

14,000 250 3,000 450 1,400 140 14,000 400 400 12,000 350 12,000 2,500 1,200 120 200 350 10,000 300 10,000 100 1,000 10,000 2,000 300 250 150 8,000 250 800 80 8,000 1,500 200 6,000 6,000 200 600 60 100 150 1,000 150 4,000 4,000 400 40 4,000 100 50 100 2,000 500 200 20 50 50 2,000 0 0 0 0 0 0 0 0 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015

Median price $/ha (LHS) Number of transactions (RHS) Median price $/ha (LHS) Number of transactions (RHS) Median price $/ha (LHS) Number of transactions (RHS) Median price $/ha (LHS) Number of transactions (RHS) MedianMedian farmland farmland price – priceSA – SA Annual Annualmedian median farmland farmland price growth price growth– SA – SA EstimatedEstimated number number of farmland of farmland transactionstransactions per year per – SAyear – SA 3,500 3,500 50% 50% 1,200 1,200

3,000 3,000 40% 40% 1,000 1,000 2,500 2,500 30% 30% 800 800 2,000 2,000 20% 20% 600 600 1,500 1,500

Median price ($/ha) 1,000 Median price ($/ha) 1,000 10% 10% 400 400

500 500 0 0 200 200 0 0 *Use price information with a small volume of transactions -10% -10% 0 0 with caution. The median price for municipalities with less

1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 2015 2013 2015 Farmland sales 1996 1997 1998 1999 1996 2000 1997 2001 1998 2002 1999 2003 2000 2004 2001 2005 2002 2006 2003 2007 2004 2008 2005 2009 2006 2010 2007 2011 2008 2012 2009 2013 2010 2014 2011 2015 2012 2013 2014 2015 SA | REGIONAL PERFORMANCE 1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 than2015 2013 five2015 sales in 2015 is not reported. by municipality – SA **Refer ‘About the research’ page SA

Median $/ha Est. # of Municipality Region transactions MedianMedian farmland farmland price price– SA – SA AnnualAnnual median median farmland farmland price pricegrowth growth – SA – SA EstimatedEstimated number number of farmland of farmland 2015** transactionstransactions per year per –year SA – SA 2015* 3 year avg 3,500 3,500 50% 50% 1,200 1,200 Adelaide Hills Adelaide and Fleurieu Peninsula 20,945 19,432 14 3,000 3,000 40% 40% AdelaideAdelaide and Fleurieu and Fleurieu Peninsula Peninsula1,000 1,000 South EastSouth East Alexandrina Eyre PeninsulaEyre PeninsulaAdelaide and Fleurieu Peninsula 11,504Yorke PeninsulaYorke Peninsula 12,088 and Mid and North Mid North42 2,500 2,500 14,000 14,000 250 250 3,000 3,000 450 450 1,400 1,400 140 140 14,000 14,000 400 400 30% 30% 800 800 Barossa Adelaide and Fleurieu Peninsula 13,296 14,890 13 2,000 2,000 400 400 12,000 12,000 350 350 12,000 12,000 2,500 2,500 1,200 1,200Barunga West Yorke Peninsula120 and Mid120 North 3,954 4,441 7 20% 20% 600 600200 200 10,000 10,000 1,500 1,500 350 350 300 300 10,000 10,000 Berri Barmera South East 100 100 1,948 0 1,000 1,000 10,000 10,000 2,000 2,000 300 300 250 250 Median price ($/ha) 1,000Median price ($/ha) 1,000 10% 10% 400 400150 150 Ceduna Eyre Peninsula 298 265 5 8,000 8,000 250 250 800 800 80 80 8,000 8,000 1,500 1,500 200 200 500 500 Clare and Gilbert Valleys Yorke Peninsula and Mid North 6,000 6,0009,628 8,689 10 0 0 6,000 6,000 200 200 200 200 600 600 60 60 100 100 150 150 0 0 1,000 1,000 150 150 Cleve Eyre Peninsula 4,000 4,000 985 880 6 -10% -10% 4,000 4,000 0 0 400 400 40 40 4,000 4,000 100 100 50 50 100 100 Coorong South East 1,712 1,598 35 1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 2015 2013 2015 500 500 1996 1997 1998 1996 1999 1997 2000 1998 2001 1999 2002 2,0002000 2003 2001 2004 2002 2005 2003 2,0002006 2004 2007 2005 2008 2006 2009 2007 2010 2008 2011 2009 2012 2010 2013 2011 2014 2012 2015 2013 2014 2015 200 200 20 20 50 50 1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 2015 2013 2015 50 50 Copper Coast Yorke Peninsula and Mid North 2,000 2,0002,947 3,749 8 0 0 0 0 0 0 0 0 0 0 0 0 0 Elliston0 Eyre Peninsula0 0 887 3 1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 2015 2013 2015 1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 2015 2013 2015 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 2015 2013 2015 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 Flinders Ranges Yorke Peninsula and Mid North 743 419 5 Franklin Harbour Eyre Peninsula 640 494 6 Median priceMedian $/ha price (LHS) $/ha (LHS)Number ofNumber transactions of transactions (RHS) (RHS) Median priceMedian $/ha price (LHS) $/ha (LHS)Number ofNumber transactions of transactions (RHS) (RHS) Median priceMedian $/ha price (LHS) $/ha (LHS)Number ofNumber transactions of transactions (RHS) (RHS) Median priceMedian $/ha price (LHS) $/ha (LHS)Number ofNumber transactions of transactions (RHS) (RHS) Goyder Yorke Peninsula and Mid North 2,109 2,032 23 Grant South East 7,325 7,655 19 Kangaroo Island Adelaide and Fleurieu Peninsula 2,483 2,150 19 AdelaideAdelaide and Fleurieu and Fleurieu Peninsula Peninsula SouthSouth East East Eyre PeninsulaEyre Peninsula YorkeYorke Peninsula Peninsula and Mid and North Mid North Karoonda East Murray South East 547 542 8 14,000 14,000 250 250 3,000 3,000 450 450 1,400 1,400 140 140 14,000 14,000 400 400 Kimba Eyre Peninsula 735 779 19 400 400 12,000 12,000 350 350 12,000 12,000 2,500 2,500 1,200 1,200 120 120 200 200 Kingston South East 3,185 2,836 7 350 350 10,000 10,000 300 300 10,000 10,000 100 100 1,000 1,000 10,000 10,000 2,000 2,000 300 300 250 250 Light Yorke Peninsula and Mid North 8,663 9,701 16 150 150 8,000 8,000 250 250 800 800 80 80 8,000 8,000 Lower Eyre Peninsula Eyre Peninsula 2,743 3,349 14 1,500 1,500 200 200 6,000 6,000 6,000 6,000 200 200 600 600 60 60 100 100 150 150 Loxton Waikerie South East 591 601 23 1,000 1,000 150 150 4,000 4,000 4,000 4,000 400 400 40 40 Mallala Yorke Peninsula and Mid North 10,004 8,439 14 4,000 4,000 100 100 50 50 100 100 2,000 2,000 500 500 200 200 20 20 50 50 Mid Murray South East 1,264 1,210 56 50 50 2,000 2,000 Mount Barker Adelaide and Fleurieu Peninsula 18,214 18,260 16 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Mount Remarkable Yorke Peninsula and Mid North 1,869 1,950 20 1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 2015 2013 2015 1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 2015 2013 2015 1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 2015 2013 2015 1995 1997 1995 1999 1997 2001 1999 2003 2001 2005 2003 2007 2005 2009 2007 2011 2009 2013 2011 2015 2013 2015 Murray Bridge South East 1,547 1,498 19

Median Medianprice $/ha price (LHS) $/ha (LHS)NumberNumber of transactions of transactions (RHS) (RHS) Median Medianprice $/ha price (LHS) $/ha (LHS)NumberNumber of transactions of transactions (RHS) (RHS) Median Medianprice $/ha price (LHS) $/ha (LHS)NumberNumber of transactions of transactions (RHS) (RHS) Median Medianprice $/ha price (LHS) $/ha (LHS)NumberNumber of transactions of transactions (RHS) (RHS) Naracoorte South East 4,134 4,366 42 Northern Areas Yorke Peninsula and Mid North 2,725 3,325 23 Onkaparinga Adelaide and Fleurieu Peninsula 13,865 4 Orroroo Carrieton Yorke Peninsula and Mid North 818 4 Peterborough Yorke Peninsula and Mid North 546 1 With the value of farmland linked to its productive capacity, it is no surprise that Port Pirie Yorke Peninsula and Mid North 2,939 3,334 13 farmland values have been increasing over the same time period where significant Renmark Paringa South East 1,003 1,420 9 gains have been made in yields. New cropping techniques and machinery have Robe South East 4,720 4 led to increased yields in the cropping districts, particularly the Mid North, Yorke Southern Mallee South East 1,166 985 15 Streaky Bay Eyre Peninsula 240 311 6 Peninsula and Lower Eyre Peninsula. Bluegum investment schemes in the South Tatiara South East 2,238 2,447 40 East during the early 2000s saw prices spike and people less willing to sell land Tumby Bay Eyre Peninsula 2,445 2,383 12 below prices received at that time. Values have been stagnant in the past few years Victor Harbor Adelaide and Fleurieu Peninsula 17,586 12,246 5 Wakefield Yorke Peninsula and Mid North 2,160 3,158 20 and farmers have been reducing debt at the same time. Wattle Range South East 5,454 5,446 24 Tom Kennedy, Agribusiness Relationship Manager, Rural Bank, South Australia. Wudinna Eyre Peninsula 823 3 Yankalilla Adelaide and Fleurieu Peninsula 11,230 10,189 13 Yorke Peninsula Yorke Peninsula and Mid North 4,721 4,667 13 Adelaide and Fleurieu Peninsula 12,061 11,828 126 South East 2,164 2,083 301 Eyre Peninsula 886 841 74 Yorke Peninsula and Mid North 3,521 3,836 177 Together, Rural Bank and Rural Finance For report enquiries: About Ag Answers are supporting farmers and farming Ag Answers is a specialist insights communities by providing them with AG ANSWERS specialist financial tools, industry division of Rural Bank and Rural Finance. P 1300 796 101 insights and investment into the future Recognising that good information is the E [email protected] key to making good business decisions, of the Australian agribusiness sector. Ag Answers provides research and analysis into commodities, farmland values, The future for farm business performance and topical agricultural issues to enable farmers to agriculture is bright For banking enquiries: make informed decisions. We provide exceptional financial services, knowledge and leadership for Australian RURAL BANK About Rural Bank and farmers to grow. P 1300 660 115 Rural Finance W ruralbank.com.au

R ural Bank has been a wholly-owned ELDERS subsidiary of Bendigo and Adelaide P 1300 618 367 Bank Limited since 2010 and is the only E [email protected] Australian-owned and operated dedicated agribusiness bank in the country. From 1 July 2014, Victorian agribusiness lender, Rural Finance joined Rural Bank as a division of Bendigo and Adelaide Bank Limited. As a specialist rural lender, Rural Finance has been fostering the sustainable economic growth of rural and regional Victoria for 70 years.

This report is intended to provide general information on a particular subject or subjects and is not an exhaustive treatment of such subject(s). The information herein is believed to be reliable and has been obtained from public sources believed to be reliable. Rural Bank Limited, ABN 74 083 938 416 AFSL/Australian Credit Licence 238042, and Rural Finance, a division of Bendigo and Adelaide Bank Limited ABN 11 068 049 178 AFSL/Australian Credit Licence 237879, make no representation as to or accept any responsibility for the accuracy or completeness of information contained in this report. Any opinions, estimates and projections in this report do not necessarily reflect the opinions of Rural Bank and Rural Finance and are subject to change without notice. Rural Bank and Rural Finance have no obligation to update, modify or amend this report or to otherwise notify a recipient thereof in the event that any opinion, forecast or estimate set forth therein, changes or subsequently becomes inaccurate. This report is provided for informational purposes only. The information contained in this report does not take into account your personal circumstances and should not be relied upon without consulting your legal, financial, tax or other appropriate professional.