2022 Farmland Rental Rates

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Renting land is a business approach that offers financial flexibility because the financial cost of renting is often lower than buying. Renting may be a great option, especially for young farmers or new entrants, to maximize equipment use, expand their land base, and grow their operation. Buying land can tie up your available capital and reduce cash flow, leaving fewer financing options for machinery, input needs or future expansion opportunities.

Land prices, rental rates, farm revenue, and interest rates tend to move together over the long run, yet the relationship between these variables can be disrupted at any time.

In 2022, the weighted average Rent to Price ratio of Canadian cultivated land is 2.55%, a slight increase from drought-stricken 2021, however lower compared to 2020.

Also, the relationship between rental rates and cropland revenues can assist in deciding between renting versus purchasing.

Rental rates as a proportion of crop revenues have declined since 2020. While renting is generally less expensive than the annual cost of farmland ownership, other issues matter when determining renting vs buying. Ownership vs. renting is a decision that must meet the business’s strategic objectives.

Get the provincial breakdown of rent to price ratios and more here.

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