Analysis by Farm Credit Canada shows farmland rental rates in Western Canada have not been increasing as quickly as farmland prices.
In 2025, the average price of Saskatchewan farmland increased by 9.4 per cent, but rental rates did not keep pace. FCC uses a rent to price ratio to analyse the relationship between the two. This is the cash rental rate per acre divided by the value of cultivated land per acre.
Back in 2024, the average rent to price ratio in the province was 3.1 per cent. For 2025, FCC has calculated the ratio at 2.9 per cent. In other words, cash rent each year is typically 2.9 per cent of the land’s value.
It should be noted that the ratio has a wide range from 1.6 per cent all the way to 4.4 per cent. However, at the average rate of 2.9 per cent, farmland worth $3500 an acre would generate a yearly cash rent of about $100 an acre.
Renting land has become more attractive relative to borrowing money to buy land. Assuming a 25 per cent downpayment and a 25-year amortization, the cost per acre to rent land in Saskatchewan is more than $80 an acre less expensive each year than buying land. Of course, with renting, you don’t gain from rising land values.
In Alberta and Manitoba, the rent to price ratio is lower and there’s a much greater profitability advantage to renting versus buying. The full analysis is available on the FCC website.
