minding your business

Three main takeaways from FCC farmland

values report Across the country, trends varied, highlighting once again that themarket for farmland is truly local.

By J.P. Gervais C

anadian farmland values increased at an average annual rate of 8.4 per cent in 2017. That represented a pace in the year- over-year growth of average values that picked up for the first time since 2013.

Farmland has grown in value each year since 2013 but it slowed from 22.1 per cent growth in 2013 to 10.1 per cent in 2015.

Across the country, trends varied, highlighting once again that the market for farmland is truly local.

I draw three main conclusions from the 2017 FCC Farmland Values Report, which was released in April. 1. The decline in the rate of growth takes a breather.

The growth in farmland values picked up its pace at the national level, although by a relatively minor 0.5 per cent over the previous year. 2017 farmland values increased in every province, ranging from 2.7 per cent (British Columbia) to 10.2 per cent (Saskatchewan).

In fact, growth picked up significantly not only in Saskatchewan, but in Ontario and New Brunswick too. These three provinces recorded at the same time, a slight decline in crop receipts. That’s important, given the relationship between revenues and land values. But while a higher receipts-to-values ratio in Saskatchewan for 2017 still compares favourably with its long-term

British Columbia Berry Grower • Summer 2018 15

average, Ontario and New Brunswick have ratios that exceed their long-term averages. Clearly, buyers in Eastern Canada expect growth in future revenues. Mimicking the national trend of increasing farmland values, four provinces – British Columbia, Alberta, Manitoba, and Prince Edward Island – saw values grow in 2017, but they did so at slower rates than in 2016.

2. No two regions are alike.

Nowhere is the importance of “local” more apparent than at the regional level of farmland sales. Of the 51

regions reported in the FCC study, 18 regions recorded an average annual increase of at least 10 per cent. At the other end of the spectrum, seven

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