Increasing numbers of lifestyle properties are cropping up around the country as farm land converts to residential use.
Wednesday, October 8th 2008, 12:47PM
by The Landlord
Research from real estate company Bayleys shows the development of country lifestyle patches on the outskirts of the major cities and provincial centres have drawn an increasing number of families out of the city to greener locations, usually within 45 minutes drive time from central business districts.
Bayleys research analyst Ian Little says traditionally, buyers of lifestyle blocks were focused on the land’s income-producing potential, such as grazing or orchard production, but “People today are buying lifestyle blocks which are much smaller than then 10-acre block and have no intention of using the land for agricultural purposes. They are in it strictly for the country ambiance.”
Easy access to motorways and urban areas is a key determinant of lifestyle property values. “Properties close to cities or major towns tend to appreciate at a faster rate than those further out,” Little says.
The influx of people moving to lifestyle blocks from the big cities has in turn brought increased vibrancy to many rural areas. “The increased population has meant that country shops and cafes have become more economically viable, while rural school roles have also increased,” Little says.
Some farmers have also benefited, as subdivision has been a quick way of accessing capital to re-invest in their commercial operations, Bayleys country manager Richard Graham says.
Figures from the Ministry of Agriculture and Forestry estimate that the number of lifestyle blocks has been increasing by 7,000 per year, although this number has been affected by the current subdued property market.
Prices of lifestyle property has also been affected by the market. The average value nationally in the June 2008 quarter was at $552,019, down from the record level of $621,606 set in the June 2007 quarter. But prices and sales volumes are expected to recover in late 2009 or early 2010, the Bayleys report says.
