2025 Rental rates outpaced by cultivated farmland values yet again

If you’ve been watching land prices recently, you’re not alone. The latest FCC Farmland values report shows average farmland values rose another 9.3% last year - matching the pace seen in 2024. FCC has also been tracking Canadian farmland rental rates for years to better understand their relationship to farmland values. Rent to price ratios, however, did not climb at the same pace as farmland values. Canada’s rent to price (RP) ratio has steadily compressed from 2.70% in 2020 to 2.50% in 2024, and most recently, 2.35% in 2025.

For many farm businesses, renting land is a practical way to expand without the long-term financial commitment of buying. Still, lease terms - length, inclusions and renewal provisions - shape what tenants will pay. Because many agreements are fixed, rental rates often lag land values and adjust gradually. Ultimately, rents are limited by farm economics: tenants must cover costs and earn a return amid weak commodity prices and elevated input costs.

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