Australia's most expensive farming postcode is not where you might expect

You could easily buy a small car for the incredible prices being paid for each single acre of farm land in this part of the world.

Welcome to postcode 3995.

This lightly populated region in Victoria's South Gippsland better known for surfing than farming but where land prices commonly reach $20,000 per acre and higher.

It doesn't have the intensive agricultural pursuits like market gardens but is hilly country where beef cattle enjoy lush pastures and wonderful views.

Fertile loamy soils partner with high annual rainfall of around 900mm have produced small farm sizes, hence the need for existing farmers to expand.

Dairying was once strong in this rich farming pocket of the Wonthaggi region but today the focus is mostly on high beef prices.

The bonanza in sale prices has been fuelled in recent years by these smallish farm sizes, the coastal views and being just over 100km to Melbourne.

But it is not lifestylers fleeing the city who have helped propel the Woolamai district into previously unheard of prosperity for landowners but neighbours.

The leading real estate agent in the region, himself a cattle farmer as well, is Scott Andersen from Andersen Property Specialists.

"Several of the most recent sales have been to neighbours wanting to expand," he said.

Mr Andersen said neighbouring cattle farmers were keen to beat off the competition even at the high prices.

"They see they will only go higher."

The richness of the region was almost hidden in a recent farm property report from Rural Bank which detailed a land value rise of almost 27 per cent last year in the 30-50 hectare range.

The previous year, 2021, price growth here was 41.5 per cent.

It was not just the pandemic inspired exodus from city lockdowns which fuelled the rise.

South Gippsland has recorded six years of consecutive growth in its median price per hectare, Rural Bank reported.

Farm land prices here have basically doubled over those six years with a rise of 98pc since 2016.

About 15 minutes from Wonthaggi, not far from the popular tourist playground at Phillip Island and just over 100km from Melbourne, it has become the hottest of all farming hot spots.

The 2021 Census results for postcode 3995 reveal a district population of 11,596, where women outnumber men 52 pc to 48pc.

The 60-75 years age group dominates those population stats.

Postcode 3995 provides the highest median price of anywhere in Victoria with $25,265 per hectare, or more than $10,000 per acre.

Recent sales this year show the tightened supply of land available for sale has propelled prices ever higher.

Consider these recent results from Andersen Property Specialists.

In May, a former dairy farm changed hands for almost $22,000 per acre at Bass Hills - a sale price of $4,681,600.

It was a spectacular pay day for the farm family which had owned the 86ha (231 acre) property for more than 50 years.

Last month The Airstrip farm in Woolamai, just a short distance away, sold for $2,275,000 for its 51ha (126 acres) of fertile grazing land for $18,056 per acre.

This month a small grazing block sold for a stunning $18,330 per acre.

Owners won $2.2 million for their 49ha (120 acre) block.

These are genuine but low-key farm operations.

This latest sale had two homes on the property and was on two titles which opens up subdivision potential to help pay for it.

Pomfret Peak's two homes at Woolamai are currently occupied by tenants but at its heart it remains a farm with ample water, lush pasture, hay and machinery sheds, cattle yards and crush.

And on the market today is another farm, nearby at Kilcunda.

This one takes in 66 acres and agents have suggested a selling price of $30,000/ac plus for the four-bedroom home, coastal views, five dams, stock yards and cattle crush.

With the current demand, there is no reason to expect it won't reach that price.