In this week’s property review, industry experts offer insights into the expectations for the 2025 grazing property market across Australia. Various factors have been identified as significant direct and indirect influences on the property market this year, including the repercussions of tariff wars initiated during Donald Trump’s presidency, a depreciating Australian dollar that enhances the allure of Australian grazing assets for international investors, and a sustained interest in carbon markets.

HTW valuer Will McLay.

Market Trends and Predictions

According to Will McLay, a valuer at Herron Todd White, the market conditions for 2025 are expected to mirror those of the previous year. He notes that while there has been a decline in the number of properties available and a decrease in buyer activity compared to 2024, there remains sufficient depth in the market for discerning buyers to invest in quality assets at peak market prices.

Mr. McLay emphasizes that the property market is significantly influenced by cattle prices. He remarks, “If the upcoming season favors cattle prices, we could see a continuation of the upward trend observed in 2024.” He forecasts a stabilization of land values in the short term, suggesting that while there may not be an immediate increase in values, a growing interest from buyers could lead to more activity in the market, particularly if beef commodity outlooks strengthen.

Optimism in Investment

Jesse Manuel, national director of agribusiness transaction services at Colliers, expresses a renewed sense of optimism for 2025. He notes that while 2024 was characterized by a period of adjustment, the current year has already seen a surge in confidence among clients, as quality assets come onto the market.

Jesse Manuel, Colliers Agribusiness

Mr. Manuel points out that a clearer understanding of agricultural investment economics is emerging, which is likely to result in positive sales outcomes nationwide. He also notes a notable trend of increased inquiries and purchasing mandates from high-net-worth individuals abroad, particularly from the United States, where the favorable exchange rate enhances the attractiveness of investing in Australia.

Institutional Investment and Market Dynamics

According to Danny Thomas, a senior director at LAWD, 2025 is expected to be significantly busier than the previous year. He predicts a “step-change” in market activity, driven by increasing institutional involvement and a wave of overseas capital, particularly from North America and Europe, with little activity emerging from China.

Danny Thomas

Mr. Thomas highlights that Australia represents good value for investors from North America and Europe, particularly in light of the exchange rate. He also notes that the nature-based solutions market is drawing more investment into Australia, as opportunities to access carbon credits and biodiversity offsets become increasingly appealing.

He warns, however, that if increased market activity occurs alongside limited supply, property prices could see an upward trend. For now, he believes that the market will remain relatively stable, with property prices tracking sideways due to existing pent-up supply.

Family Farms and Market Conditions

Mark Barber, who leads agribusiness investment services at Elders, anticipates that 2025 will reflect the conditions experienced in the latter half of the previous year. He notes that 2024 was a challenging year for rural property sales, with livestock prices declining significantly late in the year, resulting in a cautious approach from buyers.

Mark Barber

However, as livestock prices began to recover and seasonal conditions improved in various regions, properties of good quality in desirable locations began to sell, albeit with longer time on the market. He notes that family farmers with strong balance sheets remained competitive, while corporate investors faced challenges in achieving their return hurdles due to high property values.

Mr. Barber concludes that if trading conditions remain steady in 2025, property prices are likely to hold firm, particularly in regions like Victoria and South Australia, assuming favorable autumn conditions occur. He emphasizes that Australian agriculture continues to offer secure capital and reasonable returns, despite some volatility in commodity prices and seasonal conditions.

Key factors influencing the market in 2025 will include commodity prices under the new U.S. administration, interest rates, and seasonal conditions. The impact of U.S. tariffs on commodity prices is particularly vital, as China, a major importer of Australian commodities, could slow growth and demand if tariffs are imposed.