Economics

Economic Stability and Growth

Australia is internationally renowned as having one of the world’s most stable economies. 

Closely linked to the Asia-Pacific region, Australia’s economy is unmatched by large comparable economics in Europe and North America and continues to benefit from demand in regional markets in terms of export commodities.

Australia is also well positioned to cope with economic instability due to low public debt and continual economic expansion. The International Monetary Fund (IMF) puts Australia’s GDP at US$1trillion making Australia the fourth largest economy in the Asia-Pacific region and the 14th largest in the world.

Hugh Ball has specialised in dry land cropping in North West NSW for over 17 years. He manages a dry land cropping area in excess of 15,500 hectares consisting of both family owned and absentee corporate owned operations.

Capital Gain

Along with profit generated from production, Australian agriculture also benefits from capital growth. Unlike other asset classes there is an underlying retention of capital despite seasonal events.

Australian farmland has increased in value by 5-6% per annum over the last 10-15 years across all cropping regions and is projected to grow at an estimated rate of 4-6% per annum.





Lease Rates

Investors can generally expect lease rates between 3- 6% of capital value depending on the nature of the asset. Production stability and favourable climatic and environmental conditions are factors that help to determine land value.

Rental returns as a percentage of capital value tend to be lower on higher priced assets due to the lower level of risk exposure from unfavourable weather conditions and production characteristics.