Rural land prices in QLD

Writing from out of Australia - am I correct in assuming that current land prices in Southern Central QLD are approx. 6300 AUD per hectare? I am researching a potential land deal there of approx. 30 000 hectares of pastoral land. Lacking more details info. at the moment re. carrying capacity soil type etc. etc., bu‎t the number reached via simple math seems abnormal, even factoring in a 52% YoY rise, vis-a-vis what similar-sized or larger stations have gone for in the past. Am I calculating correctly for a helicopter base-line cost?

 

Are you sure you mean pastoral ? $630 a Ha would be closer to the mark. Even with recent large increases DSE rates of up to $780. Even that would be high and the most you would want to pay.

 

Many thanks for replying, trying to make a go-nogo decision on investing more time into investigating a potential property deal further with very little to go on :-D - I'm abroad, owner's abroad and going on a title from 1997....

My "calculation" was based on my understanding that... "The median value of Queensland farmland increased by 10.3% to $4,167/ha in 2016 following a 3.3% increase in 2015" https://www.ruralfinance.com.au/uploads/aga_documents/australian-farmland-values-report-2016.pdf. However, I have now noted the table in that document which shows a median price that is ten-fold lower for 500+ hectare blocks. Why is that? Because in general smaller blocks are statistically higher in quality of land and larger blocks of thousand or tens of thousands of hectares would more likely have, due to their likely location, lower DSE?

 

No , It depends on what qualities you want. Larger properties of equal productivity, rainfall, soil type location attract more wealthy buyers and get better prices. If the price is not acceptable it may be sold in smaller lots. Smaller lots are more for lifestyle or generaly have more improvements, infrastructure, buildings, sheds, yards etc which make up a much higher % of the price. You cant compare a banana farm to a sheep station and get a median price, or value land on how much it increased in two years, or what is was worth in the past. You value it on what it can produce at what margin in the future. If you must invest in Australian agriculture, leave it to the experts and invest in ASX listed REIT RFF, get great yield and great growth and most importantly your money will be much safer.

 

Thanks again for a very succinct and concise overview! My client has a need (to sell - based out of Australia) and wants me to look at managing the process and has zero knowledge of the market. As his adviser I am bringing myself up to speed prior to reaching out to the relevant partners in Australia. Thank you again for your time and advice.