Rabobank's 2025 succession research found that 39% of New Zealand farmers have no child seriously interested in taking on the farm. For those families, succession is a sale. And for most, the farm is also the retirement fund.

The good news is that most of what protects your sale price is within your control. The catch is that it needs to be done well before the property is listed. Issues that cost a few thousand dollars to fix twelve months out can cost far more when a buyer finds them three weeks before settlement and uses them to renegotiate.

Here is what to work through first.

1. Sell the land, or sell the business?

If your farm is owned by a company or a trust, there may be a choice between selling the farm itself (an asset sale) or selling the shares in the company that owns it (an entity sale).

Most farm sales are asset sales, and most buyers prefer them, because they get the land, stock and plant without inheriting the company's history. But the structure affects tax, the warranties you give, what happens to any debt, and who can buy. It is worth understanding your options and their consequences before an agent starts talking to buyers.

2. Get your ownership structure in order

Before you can sell, the right people need to be able to sign. If the farm is in a trust, are the trustees current and correctly recorded on the title? Has anyone died, retired or moved overseas without being replaced? Does the trust deed actually allow the sale on the terms you want?

If the farm is in a company, are the share register and directors up to date? Are there shareholders' agreements, family loans or guarantees that need to be dealt with?

These are routine to fix in advance, and genuinely disruptive to discover during a sale.

3. Fonterra shares

If you supply Fonterra, your shares need to be dealt with as part of the exit. Depending on the deal, they may be sold to the buyer, sold on the market, or surrendered. The timing matters, because it can affect the value you receive and the dividends you are entitled to, and it needs to line up with the end of your supply and with settlement.

Check your current shareholding against your supply, and talk to your accountant about the best timing well before you sign an agreement.

4. GST

Farm sales between GST-registered parties are usually zero-rated, either as a going concern or under the compulsory zero-rating rules for land. But the position depends on the details: whether the buyer is registered, whether any part of the property will be used as a private home, and how the agreement records it.

Getting the GST clauses wrong on a multi-million dollar sale is an expensive mistake. Your lawyer and accountant should agree the GST treatment before the agreement is signed.

5. Consents and compliance

This is where buyers have become much more careful, and where the most value can be lost.

Pull together every resource consent that applies to the farm: effluent discharge, water takes, any other discharge or land use consents. Check each one is current, check when it expires, and check whether you are complying with its conditions. Water and discharge permits are held by a person rather than attaching automatically to the land, and they need to be formally transferred to a new owner, so the agreement should deal with that.

Penalties under the Resource Management Act rose sharply in August 2025. The maximum fine for an individual went from $300,000 to $1 million, and for a company from $600,000 to $10 million. Fines can no longer be insured against. Buyers know this, and their due diligence now looks hard at compliance history, council correspondence and any abatement notices.

Buyers will usually ask for warranties that the farm complies with its consents. If there are issues, it is far better to identify them and either fix them or disclose them on your terms than to have them surface during due diligence.

6. Overseas buyers

Farmland is sensitive land under the Overseas Investment Act 2005. An overseas buyer will generally need consent from the Overseas Investment Office, and in most cases farmland must first be openly advertised for sale to New Zealand buyers. If there is a chance an offshore buyer will be interested, the marketing campaign needs to be set up correctly from the start, or that buyer may be ruled out.

7. The homestead

If you are selling the whole farm, the house usually goes with it as farmland, and the bright-line test, now two years, rarely comes into play. But if you are keeping the homestead, subdividing it off, or have bought or reconfigured titles recently, check the tax position before you commit to a plan.

If you want to stay in the area, think early about whether you want to keep a house block. Subdividing it off takes time and council approval, and is much easier to do before a sale than as a condition of one.

8. Your retirement number

Finally, the question that should come first. What do you actually need from the sale? Once debt, tax, agent's commission and costs are paid, how much is left, and does it fund the retirement you want? Knowing your number tells you what price you need, how much flexibility you have on terms, and whether options such as vendor finance or a staged sale might suit you better.

Start 12 months out

Every item on this list is cheaper, faster and less stressful to sort before the farm is listed. Ideally, start a year ahead of when you plan to go to market, and before you choose an agent.

For the wider picture, including the decision between a family handover and a sale, see our guide ‘The $150 billion conversation nobody's having’. Our three-minute succession path checker will also show you what to deal with first.

OCLaw acts for farming families across the Waikato, Hauraki, Bay of Plenty and Coromandel. If you are thinking about selling in the next year or two, get in touch at oclaw.co.nz/contact.

This article is general information only and is not legal advice. Every sale is different.