In recent years, investing in Canadian farmland has emerged as a lucrative opportunity, driven by a steady increase in land values and a growing demand for agricultural products. According to experts at Farm Credit Canada, the average price per acre of Canadian farmland has surged by more than 800 percent over the past three decades, with values continuing to rise.
Limited availability of farmland for sale, coupled with an expanding demand for Canadian agricultural products, is fueling this appreciation trend. Despite a slightly lower increase in 2023 compared to previous years, farmland values are forecasted to continue rising in 2024, reflecting a positive outlook for the industry.
However, this surge in farmland values has raised concerns about affordability, particularly for farmers looking to expand their operations. The steep increase has made farmland acquisition increasingly challenging for new entrants into the farming sector, leading to concentrated ownership and limited opportunities for young Canadians interested in pursuing farming as a career.
To address these challenges, a new trend has emerged: non-farmer investors, such as private equity firms, are funding farmland transactions. This model enables farmers to access land that they otherwise could not afford and provides investors with an attractive investment opportunity in a stable and growing sector. If you are looking for more details on funding, speak with our team at BC Farm & Ranch – we have a wide scope of connections with banks and private lenders and are able to assist our clients with acquisition of funding.
Investment firms are seeing considerable success by focusing on acquiring farmland and improving farm productivity to generate returns for investors. By leveraging advancements in technology and innovation in agriculture, farmers can increase production levels and revenue per acre, making farmland investment an appealing option for investors seeking long-term sustainability and growth.
Farmland investment funds provide investors with attractive returns and play a crucial role in supporting the farming sector and ensuring food security. With increasing global demand for agricultural products and growing land constraints, farmland investment presents a compelling opportunity to contribute to a sustainable and resilient food system.
As interest in farmland investment continues to grow, more investors are recognizing the potential of Canadian farmland as a stable and lucrative asset class. Whether it’s for financial gain or a commitment to sustainable investing, farmland investments offer a promising avenue for investors to diversify their portfolios and positively impact the agricultural sector and the broader economy.
If you are looking to diversify your portfolio by owning farmland, talk to our team at British Columbia’s first and only real estate office dedicated 100% to farms and acreages – BC Farm & Ranch Realty Corp.