Rural Land Prices and Their Possible Influence on Residential Property Markets in Rural Towns

Over the past twenty years, there has been a general increase in rural land prices across the majority of New South Wales. In particular, there have been a number of locations with land price increases well above the state average. These same locations have also been subject to increased levels of foreign investment and ownership of rural land and greater participation by rural investment and management institutions. This paper will compare the changes in rural land prices across a range of rural locations to the residential and commercial property markets in the main town centres servicing these rural areas. Issues that will be addressed in the analysis will be property population numbers, sales volume, and house prices across these centres compared to changes in the price of rural property. The analysis will determine if the rural property prices are driving residential and commercial property markets in these locations or if the non-rural property markets are driven by non-rural market factors. The quantitative data will cover the period January 1990 to December 2015 providing an extensive overview of the issue as it applies to regional rural centres in New South Wales, Australia.