25 Jul 2012

New gauge for farm sales prices

1:50 pm on 25 July 2012

The Real Estate Institute has introduced a new way to gauge changes in underlying farm sale prices.

The new measure has been developed in conjunction with the Reserve Bank, and adjusts farm prices to account for location, size and farm type.

The Farm Price Index will also take into consideration interest rates, commodity prices, exchange rates and farm costs, which the Institute says can make up a third of the price trend movement.

It will be used from next month.

The Institute will keep its median price per hectare measure each month as a guide to assess the initial value of properties.