Trends in rural land prices in New Zealand 1954-1969

Abstract

This paper examines post-war trends in rural land prices. New Zealand has a freehold system of land tenure and a land registration system based on the Torrens system first used in South Australia. As a result, reliable records are available of all rural land transactions for some considerable period of time.

The paper examines an entirely new representative series of rural land market values for the period 1954 to 1969, based on official records and explores in detail, economic changes in the aggregate rural land market over this period.

Readers will be interested particularly in the relationship between the market price of land and expected income. Land buyers are shown to discount increases in income at a relatively high interest rate and thus hedge against possible future fluctuations in farming income, while at the same time accepting lower average returns than in the immediate post-war years.