Ontario farmland value increases 'middle of the road' says appraiser Friday, April 16, 2010 by SUSAN MANNThe value of Ontario’s farmland continued its upward climb during the last six months of 2009 increasing by an average of 3.3 per cent in that time period.According to the most recent Farm Credit Canada’s farmland values report, released Monday, it was the sixteenth year Ontario’s farmland values had increased. Laura Leyser, a Huron Perth-area realtor and dairy farmer, says farmland value is going to continue to increase. Livestock farmers looking for land to meet nutrient management requirements is driving demand.Rising land values make it hard young people to get into farming, she says, noting the only producers who can afford to buy farms are established working farmers. “In my trading area, there will be maybe 10 farmers who own the majority of farms around.” Dale Litt, Farm Credit senior appraiser, adds low interest rates, favourable grain prices and high yields to the list of factors driving demand. There’s still a huge demand for both high quality and marginal farmland.Increasing land values may be leading to more farmers renting land now than five years ago. “Land has risen significantly in the last five years in most cases all throughout Ontario and Canada,” Litt says. In a separate survey done in November 2009 by 971 farmers across Canada, Farm Credit found that 58 per cent of farmers both own and rent the land where their production is located. Almost half of the farmers, or 45 per cent, who said they rent some or all of their land rent more now than five years ago. “It’s a more cost effective way of producing crops,” says Litt. “They don’t have to have the capital expenditure to buy the land.”But in some cases farmers “need the land for production but they can’t afford to buy the land at that time,” he adds.Litt doesn’t think farmland prices are making land acquisition out of the reach of most farmers. “I just think the supply of land is limited. When it does come up for sale there’s a lot of demand.” Farmers who aren’t successful in buying still need the land so their alternative is to rent.How do Ontario farmland value increases compare to the rest of Canada? “Middle of the road,” Litt says. Nationally, farmland increased by an average of 3.6 per cent during the last six months of 2009. Manitoba had the highest average increase at 5.9 per cent, while land prices in Prince Edward Island and British Columbia remained the same for the last six months of 2009 as they did for the first half of the year. Farm Credit has issued the farmland values report since 1984. The report is published twice a year. BF Court rejects quota policy appeal Farm couple takes waste dispute to a higher court
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