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Australian Agricultural Forecast signals a positive outlook for rural property Values in 2025.
Despite challenges and drier conditions in some regions, the agriculture sector is projected to achieve its second-highest production value on record in 2024–25, according to the Australian Bureau of Agricultural and Resource Economics (ABARES)[I], a trend that is also expected to positively impact rural real estate values.
This news is particularly promising given reports in Australia highlighting a surge in foreign investment, particularly from the US, in Australian agricultural properties in 2025[ii].
ABARES forecasts the combined value of the agriculture, fisheries, and forestry sectors to reach $94.3 billion this financial year. “The agriculture sector alone is set to be worth $88.4 billion, up $6 billion from last year,” said Dr Jared Greenville, Executive Director of ABARES.
"The chief driver of the increase is higher prices for livestock, which has, in turn, driven higher livestock production.
"The gross value of crop production is also forecast to rise by $2.2 billion as higher domestic production more than offsets lower prices on global markets.
"Winter crop production volumes have risen by 16% to a total of 55.1 million tonnes thanks to favourable growing conditions across significant parts of New South Wales, Queensland, and Western Australia.
"Production volumes though in South Australia and Victoria have suffered from poor conditions across the winter cropping season, leading to year-on-year declines in both states."
There is also good news for Australian red meat exports, which rose significantly in 2023–24 and could reach a new record in 2024–25 due to strong demand from key trading partners such as the US, China, Japan, and the Middle East. In 2024–25, red meat export values should reach record levels for both beef and veal exports (worth $13.9 billion) and sheep meat exports ($5.3 billion).
This news is sure to grab the interest of local and overseas rural property investors, especially those in the US who were behind Australia’s biggest agricultural property transactions for 2024 which saw more than 265,000 ha change hands for a collective price tag of more than $1.2 billion, according to the report in the Australian[iii].
In the year’s highest-value sale, the US Nasdaq-listed Agriculture & Natural Solutions Acquisition Corporation bought the Australian Food & Agriculture Company portfolio for $780 million. This holding spans 13 NSW farms totaling 225,405 ha, including the high-profile Wanganella and Poll Boonoke Merino studs.
The next highest-value sale was in Queensland, where Melbourne-based Warakirri Asset Management, on behalf of US-headquartered Alkira Farms, purchased the 26,855-ha Worral Creek Aggregation for $350 million – it was divested as part of succession planning by its long-time owners.
Travis Wentriro, Network Manager of Raine & Horne Rural, said demand for rural property will also likely strengthen if current rainfall forecasts for 2025 prove accurate and the Reserve Bank starts cutting the official cash rate next month.
“Other issues that will drive rural real estate values in 2025 include the costs of farming and the potential commodity yields from their farms, paddocks, holdings, crops, and herds,” Travis said.
"We also need to wait and see how US President Donald Trump rolls out his tariffs and the impact these moves have on our major agricultural export markets."
Over all the prospects are looking good.
