Land Rich, And Running Out Of Time: The Conversation Every Farming Family Needs To Have

Opinion  |  Agribusiness

Rising land values have made Australian farms more valuable than ever, and succession harder than ever. Rohan Dunsdon on why the smartest families aren’t waiting for the “right time” to start planning.

Picture the kitchen table on a property that’s been in the family for three generations. The season’s been good, cattle prices are strong, and the bank statement looks healthier than it has in years. But there’s a question hanging in the air that nobody quite wants to ask out loud: what happens to all of this when Mum and Dad step back? One of the kids wants to keep farming. The other two moved to the city years ago. And the land – the land is now worth more than anyone ever imagined. That single fact has quietly changed everything.

I spend a lot of my time sitting at tables like that one, and I can tell you the mood in Australian agriculture right now is a strange mix of optimism and anxiety. We’ve had a rare run of strong commodity prices, better cashflows, rising rural land values and real reinvestment back into farms. Family balance sheets have never looked stronger. But that same good fortune has made ownership, expansion and succession far more complicated than they used to be. If you’re feeling that tension, you’re not imagining it, and you’re certainly not alone.

Your farm is now a wealth asset, not just a workplace

The biggest shift I see is the appreciation in rural land. Plenty of families are now holding country worth far more than they’d have guessed a decade ago. On paper, that’s a wonderful thing – it reflects the productivity of Australian agriculture, the scarcity of good land and the sheer resilience of the people who work it. But in practice it changes what the farm is. What used to be, first and foremost, a working asset is now often the family’s single biggest store of wealth, frequently with very little off-farm money sitting alongside it to balance things out for the kids who didn’t stay.

That’s exactly where succession gets hard. It’s no longer just a matter of deciding who has the skill and the appetite to run the place. It’s working out how to fund a comfortable retirement for the older generation, how to treat the on-farm and off-farm children fairly but not necessarily equally, and how much debt the next generation can realistically carry. Higher land values can make an even split of assets almost impossible, while a genuinely profitable farm becomes even more emotionally and financially attractive to everyone who wants to stay connected to it.

Where the good conversation meets the hard tax reality

Tax is usually the point where a warm family chat turns into a tricky implementation exercise. Capital gains tax, transfer duty, land tax, trust vesting dates, Division 7A, the small business CGT concessions, primary production concessions – they all come into play. In my experience, the real risk isn’t that the tax can’t be managed. It’s that families leave the planning too late. Many of these concessions hinge on things like asset values, turnover, how long you’ve owned the land and how your entities are structured. A restructure that would have been simple and affordable five years ago can become expensive, or simply impractical, once values have moved.

Scale is getting harder to reach

Higher land values are also making it tougher for smaller operators to grow. Good neighbouring country is tightly held, and when it does come up it can attract local families, big farming groups, institutional money and lifestyle buyers all at once. A modest family business can suddenly find itself bidding against buyers with a lower cost of capital and far deeper pockets. That creates a genuine strategic bind: to stay competitive you often need more scale, but scale keeps getting more expensive to buy.

At the same time, a lot of farmers have used stronger cashflows and tax incentives to catch up on years of putting things off: new machinery, fencing, water infrastructure, sheds, yards, grain storage, better livestock handling. Much of that spending made good commercial sense as well as good tax sense, and the result is that plenty of properties are now more efficient and more resilient than they’ve ever been. The catch is that it raises the bar for everyone. A buyer today isn’t just purchasing hectares; they’re buying water certainty, working infrastructure and the ability to generate cashflow from day one. That’s wonderful if you’re selling. It’s daunting if you’re the next generation, or a smaller operator, trying to get in.

New ways to own the farm

One model I expect we’ll see a lot more of is what you might call “shadow ownership.” The next generation increasingly runs the farm, makes the day-to-day calls and services the debt, often through a lease or share-farming arrangement, while the older generation holds onto the legal title of the land for longer. It can be driven by asset protection, retirement funding, duty costs or simply a wish to keep family control for a while yet. It can work well, but only when it’s properly documented. Families need to agree, in writing, on who makes decisions, what gets drawn, how capital spending and risk are shared, and what actually triggers the eventual transfer.

For smaller operators, the answer often calls for a bit of creativity:

• Long-term leasing to build scale without buying land outright
• Share farming or agistment to spread fixed costs
• Machinery syndicates to cut capital intensity
• Joint ventures where a couple of families pool capital to buy a larger holding together

I’ve even seen neighbouring families jointly acquire a property with side agreements covering future subdivision, water access, infrastructure and exit rights. None of it is set-and-forget – it all needs careful tax and legal structuring – but it can be the difference between keeping pace with the market and being left behind by it.

Don’t wait for the “right time”: make the call now

So if there’s one thing I’d urge you to do after reading this, it’s to pick up the phone and get in touch with your accountant about succession planning – this season, not “someday.” Succession isn’t a will, a transfer, or a handshake over the kitchen table. It’s a long-term business transition wrapped up in tax, cashflow, governance, retirement planning and, above all, family communication, and the sooner your adviser is across your numbers, your structures and your family’s goals, the more options you’ll have, and the less it will cost you to act on them. The families who’ll be best placed for the next decade are the ones who start those conversations early, document their arrangements and use the tax concessions deliberately, rather than discovering too late that the easy fixes have quietly closed off.

So book that meeting, map out your plan while the choices are still yours to make, and bring your family into the room. If you’d value a hand with it, our agribusiness team at Bentleys Queensland does this work alongside farming families every day – but whoever you choose to walk beside you, the most important step is simply to start the conversation now, not later.