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Hear Hot Property with Ozzie Jurock every Saturday morning between 8:30-10 am on CKNW AM980
Tip of the Week:
3/22/08
Why Prairie Farmland May Be The Buy Of A Lifetime - Food And Water
(EXCERPTED FROM JUROCK'S FACTS BY E-MAIL)
We should not wait to buy land, we should buy land and wait ... is the old adage.
Well, your grandkids will say the same about you. But instead of B.C. and Alberta, these kids will likely be most happy that you bought land, especially raw, land at cheap prices in Saskatchewan and Manitoba, in 2008.
At the start of this decade it was all about energy and recreation. From now on it will be all about food and water and these two Prairie provinces are where it is at. The price of wheat and other crops from the Prairies are soaring, as the middle class enlarges in Asia and the misguided biofuel industry claims more cropland. This month wheat futures are $9 to $10 per bushel, twice the price of a year ago.
Meanwhile, the United States is in the midst of a drought that has lasted for 10 years. About 31% of the U.S. is experiencing moderate to exceptional drought as of early February and this is the driest spring in the Southeast U.S. since record keeping began in 1895.
Manitoba, though, has 100,000 lakes and 17% of the province is covered in water, and it is right on the U.S. border.
Saskatchewan has the lowest farmland prices in North America, despite recent increases. There are now opportunities to buy farmland in Saskatchewan, as an investor, without ever having to farm yourself.
In Saskatchewan, farmland sells on average for $350-$400 per acre, and rents for around $40 per acre. This compares with Ontario, as one example, where farmland sells for $6,500 per acre and rents for $175-$300 an acre.
There are agencies, such as Regina-based Agriculture Development Corporation (www.farmlandinvestor.ca) that create turnkey investments in Saskatchewan farmland that may generate flow-through tax deductions and rental income, with the potential of capital gains.
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