The future of New Zealand’s farm ownership
How do we find alternative solutions to farm ownership and succession while encouraging the next generation of farmers? Southland farmer and 2024 Nuffield Scholar Peter Templeton’s report Putting the success back into succession highlights it is not enough for farmers to hope that the next generation will simply take the reins. Words Peter Templeton.
As New Zealand’s agricultural sector continues to evolve, one challenge has become increasingly urgent: farm succession. An ageing farming population, skyrocketing land prices, and significant financial barriers are making it more difficult than ever for the next generation to take over the land. While the country’s farming legacy is rich and deeply rooted, its future is far from guaranteed.
“We’re at a tipping point,” says Peter Templeton in his 2024 Nuffield Scholar report on farm succession. “Without timely and strategic action, we risk losing the family farm as the cornerstone of our rural communities.”
Family Farm Succession: A Tradition Under Strain
Historically, succession was a natural progression. Children worked the land alongside their parents, eventually taking the reins. But today, the transition has grown far more complex. There are three key stages to the process – physical contribution, financial decision-making, and equity transition – but it’s the last stage, transferring ownership, that’s proving the most fraught.
“Older farmers are understandably hesitant to step back,” says Templeton. “It’s their life’s work. But without open dialogue and proper planning, succession often becomes a point of tension rather than a smooth handover.”
Among the hurdles are inheritance issues between siblings, reluctance to relinquish control, and the sheer cost of farmland.
These tensions can stall decision-making for years. According to Templeton, “Many farms operate without a clear succession plan, and that’s a recipe for future conflict – or even financial collapse.”
A Broader Vision: Farming as a Strategic Business
Templeton argues that succession planning must move from being viewed as a family matter to being recognised as a core strategic business issue. He emphasises the need for structured, early conversations, ideally facilitated by independent advisors.
“It’s not enough to hope the kids want to take over,” he says. “Farmers need to plan as if they’re handing over a company, not just a lifestyle. That shift in thinking is essential if we want farming to remain a viable multigenerational pursuit.”
The stakes are high. Without timely solutions, the erosion of family farms could lead to the decline of rural communities, the loss of intergenerational knowledge, and a fundamental shift in the way New Zealand farms.
“For New Zealand to remain a global leader in agriculture, it is essential that we ensure access to land and ownership opportunities for young, passionate, and skilled individuals.” – Peter Templeton, 2024 Nuffield Scholar
“Succession isn’t just about who owns the land – it’s about who we are as a nation,” Templeton reflects. “New Zealand agriculture is built on community, stewardship, and connection to the land. We risk losing that if we let farm ownership slip out of reach.”
The future of New Zealand farming rests on its ability to adapt to new realities while preserving its core values. Ensuring that younger generations can step into farming roles requires more than nostalgia – it demands action, innovation, and a commitment to equity.
Alternative ownership structures, financial support, and proactive planning can help navigate the storm. But they will only work if backed by collective will.
“Change is hard,” says Templeton. “But if we act now, we can make farming accessible, sustainable, and rewarding for generations to come. The tools are there – we just need the courage to use them.”
The Cost Barrier: Land Ownership Slipping Away
Beyond family dynamics, rising land prices have created significant structural obstacles for young and aspiring farmers. In the last few decades, land values have surged dramatically, far outpacing wage growth. This has widened the gap between experience and ownership.
“Even farm managers with 20 years of experience and intimate knowledge of the land often can’t afford to buy it,” Templeton notes. “Traditional banking models requiring hefty deposits just don’t align with today’s realities.”
This affordability crisis has led to a concerning trend: the rise of corporate farming. Backed by well-capitalised investors, these operations are often able to outbid family farms. While they may offer operational efficiency, Templeton warns of the long-term consequences.
“Corporate consolidation centralises decision-making and prioritises profits,” he says. “There’s a real risk that our rural communities and sustainability values could be sidelined in the process.”
Alternative Ownership Models: A Way Forward
In response to these challenges, Templeton’s report outlines several innovative ownership and succession models designed to keep young farmers on the land.
These approaches offer new pathways to equity and participation in the sector, even for those without the means to buy outright.
- Share-Farming Agreements
These arrangements allow young farmers to build equity while using existing infrastructure. Over time, they may buy into ownership. - Equity Partnerships
Here, investors share ownership and risks, creating accessible entry points for farmers without full capital upfront. - Lease-to-Buy Options
This model lets farmers lease land with the potential to purchase it later, giving them time to build capital and prove their capabilities.
Profit-Sharing and Crowdfunding
With profit-sharing models, farmers and landowners split returns, creating mutual incentives. Meanwhile, crowdfunding or SAFE (Simple Agreement for Future Equity) agreements can allow community members to support farm ownership collectively.
“These models have enormous potential,” says Templeton. “They give us the tools to reimagine farm ownership in a way that’s fair, flexible, and future-focused.”
But Templeton also cautions that innovation alone isn’t enough. “We need to scale these ideas with support from the government, banks, and the wider industry. Otherwise, they’ll remain niche solutions rather than sector-wide game changers.”
Supporting Young Farmers: A Role for Policy and Industry
To turn these models into mainstream solutions, Templeton highlights the need for robust policy and industry support. His report recommends several key initiatives:
- Banking Incentives: Encourage banks to accept alternative collateral, such as livestock or equity in farming ventures.
- Government-Backed Loans: Offer low-interest financing or guarantees to reduce barriers to entry.
- Financial Education: Equip young farmers with the skills to manage risk, succession planning, and investment strategies.
“If we’re serious about farm succession, we need to make it viable, not just aspirational,” Templeton asserts. “That means giving young people the tools – and the confidence – to take that step.”
