Four Questions to ask before investing in farmland

Four Questions to ask before investing in farmland

chilliwack farmland sunset

Home to over 17,000 farms, BC is a popular place for aspiring farmers to pursue a career in agriculture. And with over 900 of those farms located in Chilliwack, it’s no surprise that we see so many clients showing an interest in investing in farmland.

If you’re thinking about running a farm, here’s a few questions to ask before purchasing land:

WHAT ARE THE BENEFITS?

If you’re ready to make a long-term commitment, purchasing farmland can be a solid investment. Whether your dream is to grow your own crops, farm livestock, or manage the property from afar, there is endless opportunity in the agribusiness sector.

Unlike other investment types, which tend to lose value as inflation rises, the value of farmland is much more likely to increase alongside inflation. This stability is a huge draw for many investors.

In addition to the value of the property increasing steadily over time, there is the obvious value added by the various sources of income you can create using the land, including:

  • Using the land for your own crops or livestock
  • Renting the land out to other farmers
  • A combination of the two options above
  • Renting the land out for other commercial and/or residential purposes

WHAT KIND OF LAND IS BEST SUITED TO YOUR GOALS?

holding wooden box full of farm grown items

There are many considerations when it comes to selecting the right farmland.

First and foremost, you’ll need to decide what kind of crop or livestock you want to farm. When making this decision, you’ll want to consider market opportunities and thoroughly research the pros and cons of each of your options.

Once you know what you’ll be producing, you can start looking at different properties that can support that particular product. If you’re growing crops, you should get a soil test done prior to buying any land to get an accurate idea of how ready the land is to farm.

The BC Government has put together a New Farm Start Up Guide that includes info on selecting or adapting farmland to meet your needs and interests.

WHAT’S YOUR PLAN?

writing in a notebook

Investing in agriculture is a big commitment, and it’s important to plan ahead to set your farm up for success.
On top of having a vision for your future agribusiness endeavor, you’ll need to put some thought into your business goals, marketing strategy, financial planning, risk assessment and more.

For assistance on how to create a comprehensive plan for your venture, check out Taking Stock, a guide developed by the BC Government to help new farm owners start off on the right foot.

WHO CAN HELP ME IF I HAVE QUESTIONS?

taking in front of a tractor

No matter what kind of business venture you’re pursuing, it’s crucial to surround yourself with people who can support you along the way.

There are several organizations that help new farmers navigate the business, including the BC Young Farmers AssociationYoung Agrarians and Farm Folk City Folk.

If you’re seeking to buy land to get started, you should also have a strong advisor who understands the ins and outs of agricultural real estate. In the Chilliwack area, that’s where we come in!

Bryan Van Hoepen and the rest of our team have in-depth knowledge of buying farmland in the region, and will gladly walk you through the process, from determining which properties to consider to making an offer to the finalization of the transaction.

Have questions about buying a farm? Reach out any time.