Southwestern Ontario is home to some of Canada’s most productive farmland, and a “perfect storm” of low interest rates, stretches of high commodity prices and relatively good weather have driven farmland prices to dizzying heights in the region.
Ryan Parker from London, Ont.- based Valco Real Estate Appraisers & Consultants, which produces an annual survey of farmland sales in 11 counties in the southwestern region of the province, has tracked the dramatic rise in prices over the past 15 years.
In his presentation last week at the Southwest Agricultural Conference at the University of Guelph’s Ridgetown campus, Parker noted that the average price for a workable acre in the Valco study increased from $5,707 in 2010 to $25,370 in 2024, with prices reaching as high as $60,000 per acre.
In this video, Parker also shares how demand for land from livestock farmers and other factors has driven prices higher in more northern areas like Grey County. In 2024, land in Grey County sold at an average of 22,725 per acre, commanding higher prices than traditional high-value cash crop areas like Kent County, which checked in at $21,614 per acre.
In the survey, Parker also delved into the value farmers are getting when they buy acres in Grey County compared to Kent County. He notes that from a cash crop perspective, when five-year crop yield averages are factored in, there’s great value to be had in buying land in Kent at a lower price. But there’s more to the purchase story than just livestock, notes Parker, as farmers are increasingly migrating north for available land and also considering a changing climate in land purchase strategies.
See Related: Farmers expect land prices to rise in 2025, despite profitability concerns
When it comes to prices, what’s in store for southwestern Ontario in 2025? After a flat 2024 market with practically no price overall price increase, Parker is expecting more or the same for 2025. With challenging crop prices, interest rates and other financial and market questions, “I imagine we will slide sideways for another year,” he says.
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