Realtor disagrees investment firms buying up Sask. farmland
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The government of Saskatchewan is taking a second look at who can own farmland, paying particular attention to things like investment funds, but a local realtor said those changes may not make much of a difference.
On Monday, the province announced it would review farmland ownership rules, and in the meantime, it would restrict some organizations, like pension plans, from buying farmland. The review stemmed from concerns that had been bubbling about investment funds, like the Canada Pension Plan, buying land and helping to drive up land prices.
For the second year in a row in 2014, the value of Saskatchewan’s farmland grew by 18.7 per cent, the most in the country, according to Farm Credit Canada. In 2013 Saskatchewan farmland values rose by 28.5 per cent.
Some had been blaming this rise, in part, on investment funds coming in and buying up land, but Bob Lane of Lane Realty said that’s not quite true.
“The market for the last, probably, four to five years has been farmers buying land, the actual farmers themselves,” said Lane, whose company’s staff are called “farm and ranch specialists”.
Lane said since 2006 local farmers have had some good years, so they’ve been spreading more money around buying land, driving up prices.
He said most investment funds have gotten out of the market because they weren’t making enough money.
“They need a four to five per cent return, and the rents that we’re getting on the land right now, these people were not getting that four to five per cent,” said Lane.
Overall, Lane said he thinks the changes the provincial government is considering would be good.
“What they’re talking about is a very small percentage (of land owners) and the majority of the land is being bought by local Saskatchewan farmers.”
panews@jpbg.ca
