Canadian Farmland Prices Soar

[ASRG]

Just east of Red Deer.

[SASKFARMER3]

Albertafarmer5 welcome!

[perfecho]

Even though the return may be not great on an acre of land, it is always there, ready to feed the owner.....can't say the same about paper investments!

[furrowtickler]

Have a look out your window the next time you go for a drive , then tell how that investment goes for ya..

[cottonpicken]

I recommended land 6-7 years ago,it falls in line with
commodities and metals and fine wine and art work
and a herd of goats or a heard of silkworms.

Risk is all about perception,i think paper is the
riskiest thing to be in and it scares the hell out of me
almost as much as canadian housing,that crash is
going to be biblical.

[AlbertaFarmer5]

I agree that the Canadian housing crash is
going to be epic, but do you see how
farmland could separate itself? "here"
much of the premium is from city folks
wanting a place in the country. It will
be harder to borrow money for any real
estate after a crash. Would high
commodity prices be enough to keep values
high?

[ASRG]

I suspect the housing market "bubble" will burst in some places......not so sure in Alberta or Saskatchewan...where the market is being driven by a lot of oil & gas money?
Will commodity prices stay at the present levels, or are the high prices being driven by poor weather in various parts of the world? Will we still see $14 canola or $8 wheat next year if the USA returns to normal production?
Those kind of prices justify (maybe) high land prices, but $8 canola and $5 wheat might really bring a screeching halt to high farm land and high farmland rents?
If our idiots in Washington and Ottawa get us into a shooting war in the midlle east, oil might go through the roof and input costs might make it difficult to make a buck?

[cottonpicken]

Alberta and Sask are tough calls,the sheer amount of
money flowing in from the outside will help but cmhc
is nearing its 600 billion dollar ceiling and this time
round i don't think flaherty will raise it considering
his resent actions in the mortgage markets.

Him and the carney both know what is going to
happen,so credit availability from the banks for
mortgages is going to dry up,they'll be naked with
cmhc gone and all the chaos taking place in the credit
default swap market their margins and spreads will
be stretched.

Kick in the losses they will start to take on the
mortgages that are on the books outside cmhc(about
another 600 billion) and houston we have a problem.

They are already levered over 20 to 1 so a 5% asset
decline renders them insolvent.

Its like a fire in a movie theatre,most try leaving at the
same time and most burn.

By any measure our bubble is 45% bigger than the
american bubble when it burst-read that again.

I see a 50% decline from 3 weeks ago to 5 years from
now.minimum.

[furrowtickler]

Absolutely right on that cotton. That will be followed by a land price corection IMO.

[newguy]

One factor driving Sask land prices is an increasing population. People bring momey and money brings people. Hard to stop that wheel rolling. We rolled right through the last commodity crash and will roll right through the next..

[farmgal71]

These prices are making it very difficult for young people to start farming. Big will likely keep getting bigger.