Acreage vs Other Investments

If you purchased an acre of land in Canada in 1992 for $547, it would have grown in value, on average, to a sum of $4,527 for the same acre by 2022 – a 727% increase in the value of acreage over the last 30 years. Other asset classes like gold are often considered a better investment in the long run, but land investors from decades ago would happily disagree. The price of gold per ounce in Canada in 1992 was around $457, which had grown to a sum of around $2,476 in the same timeframe, by 2022. The numbers reveal that while the value per acre of farmland grew 727% in the past thirty years, gold prices grew 441%. 

Looking at British Columbia specifically, the price per acre has grown by an average of 704% in value from $1,242 per acre in 1992 to $9,986 per acre in 2022. Financial analysts and experts say that the risk-adjusted returns on Canadian land are much higher when compared to any other asset class as land prices do not experience highly volatile movements, even when compared to gold. In times of uncertainty and poor economic circumstances that impact all asset classes, land investments have also consistently shown resilient growth and remained ahead of the curve.

The increases over the last few decades also only account for simple land value – they do not consider the ongoing return on investment that farmland and acreage provide opportunities for. With room for agricultural income, rental income, and even other avenues such as agritourism, real estate is one of very few asset classes that provide a high ongoing return on investment.

So, is it a good time to buy acreage? The simple answer is that there has historically never been a wrong time to purchase land, but the sensible answer is that there are a number of factors to consider before buying acreage in British Columbia. If you are interested in making a real estate investment, speak to one of our agriculture and acreage specialists at BC Farm & Ranch Realty – we’re here to help you understand all of the nuances and finer details of buying acreage in the province.

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