Ontario farmland values followed the national trend higher in 2024, but the gains were among the weakest of all the provinces.
Farm Credit Canada’s annual farmland values report on Tuesday showed the average value of cultivated Canadian farmland increased 9.3% this past year. That was down from the 11.5% average gain recorded in 2023 but remains higher than the five- and 10-year average gains of 8.6% and 9.1%, respectively. National farmland values have ticked higher every year since 1993.
However, the average value of Ontario cultivated farmland was up just a modest 3.1% in 2024, well down from the 10.7% and 19.4% gains seen in the province in 2023 and 2022. This past year’s increase in Ontario farmland values bested only the 1.4% gain in P.E.I. and lagged well behind the 13.1% increase recorded in Saskatchewan, the highest in the country. In fact, it was the smallest annual increase in Ontario cultivated farmland values since rising just 2.1% in 1999. The biggest average valuation jump for the province was recorded in 2012 at 30.1%.
As can be seen on the graphic below, the largest gain in Ontario farmland values this past year was in the central west region at 13.5%, an area where FCC said urban pressure was the primary reason for the sharper rise. On the other hand, values were flat in the mid western region. In the early part of 2024, land values in the mid western region backed off from the prices being paid in the prior six to 12 months, FCC said. The second half of 2024 saw a slight rebound in values, with the region’s annual rate of change ending up flat overall. There was also minimal sales activity here in the last quarter of 2024, the report added.
A separate farmland values report released in January by London, ON-based land appraiser Valco Consultants also indicated a much cooler land market. That report showed average farmland values across 11 counties in the southwest part of the province were down 1.43% this past year.
Among the 11 counties surveyed for the report - Huron, Perth, Oxford, Middlesex, Elgin, Lambton, Kent, Essex, Bruce, Grey, and Wellington – Essex showed the largest average value decline in 2024, down 6.7% from a year earlier. On the other hand, Grey Country posted the largest increase, with values jumping 11.1%.
Today’s FCC report said Ontario is known for its diverse pool of farmland buyers, ranging from supply-managed operations, field vegetable producers, cash crop producers, part-time farmers and investment companies.
“In 2024, based on the trends in cultivated farmland values, buyers’ valuations for farmland seemed to have approached their maximum, resulting in farmland value ranges tightening in some regions of the province,” the report said.
