Finance question
Can I get finance to buy a dairy farm?
Yes, particularly for experienced operators with documented water and a signed milk supply agreement. One broker page says many rural lenders lend up to around 70% to 80% of value, treat that as the top of the range, and you fund the gap between the loan and the price yourself. Subject to lender assessment.
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The short answer
Dairy lenders start with cash flow, then the land
A dairy purchase is a bundle: land, water, a milking shed and sometimes the herd. Lenders value the farm itself, and even at the top of the range of around 70% to 80% of value the gap to the price is yours to fund. They also test a budget at a milk price below the season's opening price. Appetite is mixed. Experienced operators buying farms with documented water and a signed milk supply agreement are easier to fund. First-time dairy buyers, leased land, idle sheds and deals that need a high milk price draw more caution (dairy farm guide).
Prices vary widely, which is why the split in the contract matters. The guide's October 2026 listings asked from $1,200,000 to $17 million, and per cow milked, listings with a cow number ran from $10,500 to $18,800. The herd is often a second purchase on top, valued at about $2,900 to $3,600 a cow on the monitor farms, so 240 cows are worth roughly $700,000 to $860,000. Ask whether the cows, feed and plant are included, and have your solicitor split the price between land, water, herd and plant.
The deposit is more than the gap on the land. Victorian transfer duty on $2,400,000 is $136,000, you add a lender's valuation, solicitor and due diligence, and working capital for feed and wages until milk income flows. Separate finance can sit under the farm loan: livestock finance against the cows, equipment finance for the machinery, and a property-backed loan on other property you own. Ventas is a broker across 40+ lenders, paid by the lender on settlement.
Do you qualify?
What a lender looks at on a dairy purchase.
Cash flow at a lower milk price
A budget that services the debt below this season's opening price.
Milk, water and shed
A signed processor agreement, entitlements that transfer, a running shed.
Dairy experience
A record running a herd, or a manager with one.
Equity to put in
Cash or other property for the gap, duty, herd and working capital.
Why layered finance suits a dairy
Farm loan on the land
A first mortgage over the farm carries the largest share.
Livestock and machinery separately
The herd and equipment are financed against themselves.
Equity release for the gap
A loan over other property can cover duty and the rest.
A worked example
A 98 hectare Gippsland farm asking $2,693,000 with 180 cows. A lender at 70% of a matching valuation advances $1,885,100, leaving a $807,900 gap. Add Victorian duty of $155,045, $25,000 of legal and valuation and 180 cows at the guide's assumed $3,300 a head, $594,000. Cash needed is $3,467,045, and livestock finance at about 70% of the herd, $415,800, brings the buyer's share to about $1.17m. Illustrative only.
Common questions
Frequently asked questions
How much of a dairy farm can I borrow?
One broker page says many rural lenders lend up to around 70% to 80% of value, and the guide treats that as the top of the range. The lender values the farm itself, so you fund any gap to the price.
Can I finance the cows separately?
Often yes. Livestock finance against the herd is a common layer, at about 70% of the herd in the guide's example, with repayments linked to milk income.
What if I am buying my first dairy farm?
First-time dairy buyers draw more caution. Lenders look for experience, a signed milk supply agreement and equity, so a manager with a dairy record and extra security can help.
How is stamp duty worked out on a farm?
By state. Victoria's general rate is 5.5% of value from $960,000 to $2 million, then $110,000 plus 6.5% above $2 million. The herd and plant may be treated differently, so ask your accountant.