RE/MAX Annual Farmland Market Survey Released
By Amanda Brodhagen, Farms.com
Farmland is becoming a precious commodity in Canada and a new RE/MAX Market Trends Report, Farm Edition 2012, confirms that farmland values have reached new heights. The report examines trends and developments in 16 markets throughout Canada and found that markets in those jurisdictions either have increased or remained on par with 2011 prices.
The report highlighted some of the key drivers of skyrocketing farmland prices, noting that tight inventory was a driver in all 16 of the markets. Prices per acre ranged from $800 in Saskatchewan and Southern Alberta to $40,000 - $60,000 in B.C’s Fraser Valley. Other prominent areas that have seen a price spike are the Woodstock and Stratford areas where farmland has almost doubled since 2010 anywhere from $8,400 to $15,000 per acre and some locals would say that those prices are even higher than what was noted in the report.
Investment funds have said that farm returns are excellent investments; and with this in mind, many farmers aren’t interested in selling prime agriculture land and are keeping in the family so to speak. The severe drought that plagued most of the southern U.S., dry conditions in South America and some of the cold areas of Europe have accelerated the demand for Canadian farmland in particular.
The conclusions for farmland is that demand will continue to accelerate prices with projected world population growth, putting pressures on food production and growing urban sprawl will also play a pivotal role in market prices moving forward.