What are Guys Seeing?

[AlbertaFarmer5]

The land market is almost opposite to how it has functioned in recent years locally. It used to be recreational land could be at a premium to productive farmland, anything with a house improvements was a huge premium.

Now the only land for sale is land with a residence, and most of that stays on the market for years at a time, since there is a net out migration from the region in recent years.

The recreational land is back to being valued as poor pasture, since the crowd that was buying that has no money, and can't easily borrow money on bare land anymore.

Whereas farmland seems to be moving, even if the price isn't appreciating as fast as the sellers thought it was. And is back to being worth more than muskeg, creeks and trees.

I just checked MLS, and there is nothing that I would define as bare farmland for sale within 30 miles of here( here being far west of Red Deer). A few swamps, a few with houses. Outside of that radius, I did see a subdivided quarter of #3 soil for $750,000. There have been a few quarters sell for the $600,000 range, and a couple quarters listed in the $600,000 range not too far east of here in the recent couple years.

The last 2 we bought were on the market for a long time, and were purchased for a significant discount to the listed price. Not aware of other local arms length sales.

[jazz]

Outside of that radius, I did see a subdivided quarter of #3 soil for $750,000. There have been a few quarters sell for the $600,000 range, and a couple quarters listed in the $600,000 range not too far east of here in the recent couple years.

Alberta has always had more liberal land development rules. That's why you see Calgary and Edmonton ringed with acreages and not Regina and Saskatoon. Albertas land values make more sense when you figure those numbers in. The #2 corrodor has an effect too. Plus population.

But a quarter section 20 miles from regina barred from subdivision other than a 10ac farmyard and on dirt road, no utilities, just you and the drifting snow, $625k? I mean WTF.

[helmsdale]

Too many young farmers here who would like to buy the land and it doesn't make economic sense!
So instead, some foreign investors, domestic investors- who never made a nickel of their money in Ag are dumping cash into the land market-------and in some cases effectively getting the tennent to make the mortgage payment.....it's called RENT. FÃœCKEN STOOPID......leave them hang out to dry!

There are so many guys who's business plan now involves x number of rented acres, to y number of owned, and z number of acres under mortgage. It's one fuucckk of a gamble... That means they are essentially locked into the rental game, and if push comes to shove, they'd walk over their dead grandparents bodies if it meant they were solvent to do it all again next year.

There is a SIGNIFICANT push amongst the monied class to won physical assets. They are scared shitless of the stock market, as many on here also are, and they think that if they hold physical assets their ass will be covered if we experience a serious economic depression, or worse yet, an all out long term apocolypse. I remember having this conversation with a fella who was dead set on owning land as a hedge against "preper style" societal meltdown. So i asked him how he figured he would ever collect rent in the event that SHTF? Let alone how would he prevent squatters from growing a crop on his land and not sending the cheque? This idea that Physical assets are going to protect your wealth in a zombieland world ending ffuucckkshow is completely absurd! Unless you can hire and keep happy a private army to enforce your property rights over said physical assets, they are utterly meaningless in the grand scheme of things.

Got a massive house? a Township of farmland? a vault full of gold and silver bullion? collectible cars?

If you seriously think the endtimes are near, the only thing you need be worried about stocking up on are survival supplies, and enough LEAD combined with the means to dispense it, to ensure you maintain ownership of it!

[jazz]

There is a SIGNIFICANT push amongst the monied class to won physical assets. They are scared shitless of the stock market, as many on here also are, and they think that if they hold physical assets their ass will be covered if we experience a serious economic depression, or worse yet, an all out long term apocolypse.

Zombie apocalypse aside, to not be nervous about weather, trade issues, crop prices, yield, input and machine costs but to be terrified of the stock market is illogical. If someone feels that way, they have a poor understanding of risk.

Physical assets have their place but they are a sitting duck too for taxes and other BS. Liquid assets can be safely moved away in a heartbeat if that happens.

I try to have a good chunk in both dirt and liquid.

[AlbertaFarmer5]

Alberta has always had more liberal land development rules. That's why you see Calgary and Edmonton ringed with acreages and not Regina and Saskatoon. Albertas land values make more sense when you figure those numbers in. The #2 corrodor has an effect too. Plus population.

But a quarter section 20 miles from regina barred from subdivision other than a 10ac farmyard and on dirt road, no utilities, just you and the drifting snow, $625k? I mean WTF.

Really rare to find an unsubdivided quarter for sale here anymore. And most counties only allow one out.
The prices I listed are for the farmland left over after subdividing, no more development potential left.

[biglentil]

Tell me this if we lose the right to keep seed what good is the land?

[Crestliner]

Not sure I buy the idea that there is Chinese government money involved in foreign real estate purchases. My understanding is that most of the money being invested in real estate outside of China is that they are trying to protect their money from the government Hence investing it in in Canadian real estate, even if it is far overvalued, it is still better than losing it all within China during the coming economic catastrophe, currency collapse, and government crack down.

Granted, farmland is in a league of its own, and may be considered a strategic investment which government would want to encourage.

I don’t want any Chinese money In land. I would rather have a bunch of greedy swinging dick locals buying it. They pay taxes, they live the land, the money stays home and they work for free when things get tough.

F’ing Chinese....don’t trust them at all. They are traders and survivors for centuries and they go through people like crazy to get what they need. They work crazy hard are determined and make us look lazy. We are fat and relaxed here and take things for granted.

We need to take a page from them and guard our farms and land with the same fervour that they protect their’s. We are bigger and smarter and can outwork them when we disciple ourselves. They are rip off artists at the end of the day and most are motivated by survival.

They wouldn’t let us travel all over China and buy land so why should we let them do they here. They use our statistics against us and it goes on. We are such patsies....we have it all and they want it. And again NO GOVERNMENT PROTECTING OUR MOST VALUABLE ASSET.

I for one will not let them get and inch on me. Same goes for the Huts....they come in my area I will out bid the shit out of them to keep the out....sell it to my favourite BTO in the area...if I can’t swing it....I’m not Racist....I’m just not stupid....been screwed over by Huts and Foreigners before....knowing after that I had all the cards and got duped out of it do to politeness.

I’m not advocating disrespect, I’m saying lets not take this for granted and wake up one day and find the rabbit is dead. My blood has been boiling since I read this thread this morning.

Reminds me again how useless our Liberal Ag department is....sad as there is a lot of talent in the Ag civil service that is shaking their head like we are looking to change the world in a positive way.

[Crestliner]

The maximum rent one can get won’t come close to making the mortgage payment:FACT

That’s why the end of this shit show is near...But FFS keep the Chinese out. They are smart and scare the hell out of me. They are the kind of guys that could get the land, default and not pay for it and still end up with it. Skipping would help them out.

[farmaholic]

[QUOTE=Crestliner;436300]The maximum rent one can get won’t come close to making the mortgage payment:FACT

Crestliner, I did explain more than once that it is indeed happening beside me. We're not talking 500-600K / quarter dirt though. 320ish....1/2 down and the rent basically pays the mortgage. Smart "investor".

My concern would be the cherry picking, leaving the poor and mediocre dirt for the "locals".

I'm from Sask, just imagine all the outside capital that flowed into this province when investors decided to ride the land price wave....and the government let them. How much stayed here? I don't know, was lots moved out of the province? Sask definitely needed to catch up but it would have been nice to see the land appreciate in young farmer's hands...not speculators.

Seems every time I bought land I thought I paid too much.....and in 1986...I did. Land prices fell and it took awhile for them to come back up, in fact in 2004 I paid the same for very comparable land as the stuff I bought in 86. We all know what happened after 2008.....people with money looking for somewhere safe to invest it. Fast forward 12 years and here we are....about 35 years later than my first purchase and it's beginning to feel like the 80's and early 90's again. Is history going to repeat itself? I doubt it will crash but there might be a correction. Make sure you have enough time to get your money back if your buying and it falls. If you're borrowing the money that makes the acquisition cost at the end of the loan term absolutely frightful. Better hope farming is "profitable" and land apppreciates some MORE.

[farmaholic]

But when the bill comes due from the government ...its going to be a monster....

But why listen to a dumbphuckled farmer like me....

Capital gains taxes?

My accountant told me a non-farming non-"Canadian"-resident land owner is really up against the taxes owing upon sale.
I think he even told me the beneficiaries of the willed land are subject to tax upon the owner's death, no roll-over provision because the owner wasn't actively farming....could you imagine inheriting land and having to pay inheritance tax, or take a mortgage to pay it, or sell it to pay it? ....enter Liberal tax policies that might one day apply to Canadian residents...yikes.

dyodd....

[malleefarmer]

Great topic happening here to a degree but foreign investment laws tighter and it deals need govt approval has to be in interest of Australia.

One would think parts of Argie and former ussr would be better bang for there buck in production stakes or just a investment as farms suggests

[zeefarmer]

A month ago, thousands of acres of high priced land for sale all around me $3500-4000 an acre.

All sold now. Some of this stuff $625k a quarter. WTF?

I feel this industry is totally forgotten. The same day that Minister Bibu said their is no money and fixing stability programs would be costly, skippys other minister went into Toronto and announced $1.5B for housing. Absolutely zero effort being put toward our trade dealings and the carbon tax ready to go up on all of us.

Add on that an absolute weather disaster and the prices barely budge. I can safely say they never will after that. Something is rigged in the pricing.

What are people seeing in Ag that I don't?

I don't know. All I know as a younger guy, I can make it pencil out and it works on paper, but in the end, is it really worth it? What guys are talking for cash rents now equates to 30+ bus/ac canola or 35-40 bus/ac durum at current prices to pay for expenses. In SW Sask of all places. That's ALOT of risk for a possibility of reward. All I know is it isn't worth it to me and we're more than likely walking away from some rented land that's up for renewal.

[TASFarms]

I don't know. All I know as a younger guy, I can make it pencil out and it works on paper, but in the end, is it really worth it? What guys are talking for cash rents now equates to 30+ bus/ac canola or 35-40 bus/ac durum at current prices to pay for expenses. In SW Sask of all places. That's ALOT of risk for a possibility of reward. All I know is it isn't worth it to me and we're more than likely walking away from some rented land that's up for renewal.

If your landlord ain’t greedy and have someone looking for it you should be able to get it down some.

[jazz]

If your landlord ain’t greedy and have someone looking for it you should be able to get it down some.

Rental costs are generally going to match what it would take to finance it so farmers need to understand that. And land lords aren't going to be happy getting a 2% return on land. So pressure will be on for rents to go up if these types of land sales keep happening.

I mean you can get a GIC at 2% or a bank stock dividend at 5%. Has your bank ever lost money?

[zeefarmer]

If your landlord ain’t greedy and have someone looking for it you should be able to get it down some.

😂😂😂 You've never waved money in front of a Mennonite before, have you? Five years ago he said he was willing to work with us, now I think he's spent too much time at the coffee shop. This is the second guy that is done this to us already. Maybe I should start to know better by now. It's not like we're doing a poor job of things either.