In This Issue. Overall Market Trends. Overall Arable Land Market Trends Non-Arable Market Trends Improved Farm Sales Profile

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1 Sp r i n g Agricultural Newsletter market overview Overall Market Trends Strong commodity prices, record yields and low interest rates have created a strong demand for agricultural arable (cultivated) land throughout the province over the last three years. This has resulted in record prices per acre in much of Manitoba, which continued their steady increase in market value during 213. The cattle producing areas of the province such as the Interlake and parts of the Parkland and Midwestern districts, which consist mainly of non-arable land types such as bush and pasture, have not yet experienced these increases. This is due to the repercussions in the cattle industry following BSE, which resulted in depressed cattle prices from 23 until recently. The recent recovery in cattle prices due to low North American cattle herd numbers may start to put upwards pressure on nonarable land, but so far the values per acre have remained flat and relatively unchanged, continuing the trend of the last decade. District Analysis The Association of Manitoba Municipalities districts were used to determine which district a municipality was in. This was chosen because the AMM districts accurately reflects through their groups of municipalities, areas of Manitoba which are similar in geography and agricultural capability. More information about the AMM can be found on their website, In This Issue Contents In Table ThisofIssue Overall Arable Land Market Trends Non-Arable Market Trends Improved Farm Sales Profile

2 Arable Land Market Trends Arable cultivated land in the most productive cropping areas of Manitoba continues to have strong upward pressure on its market value, continuing into 214. The Central district, which has the most productive agricultural regions in Manitoba, continues to lead in both sale price per acre and volume of sales in 213. All districts display a continuing upward trend throughout 213. The Interlake district s average, which is higher than the Eastern, Parkland, Midwestern, and Western districts in the last quarter of 213, is driven up by sales which have occurred in the south end of the district, where the land is more productive and similar in agricultural capability to the Red River Valley municipalities located in the Central district. All districts display an average sale price per acre upward trend throughout 213. Sales with minimal buildings (determined by the building assessment as related to total assessment 5% or less) were treated as unimproved agricultural bare land sales. Sales which appeared have some influence due to location near urban centres or commercial industry, were excluded from analysis. Sales with a sale price per acre of $4 per acre or less were assumed to be non-arable farm land sales. AMM District 213-Number of Arable Farmland Sales 213-Lowest Sale Price per Acre Arable Farmland 213-Highest Sale Price per Acre Arable Farmland 213-Average Sale Price per Acre Arable Farmland Central 33 $472 $6,381 $2,729 Eastern 223 $46 $6,5 $1,613 Interlake 132 $49 $6, $1,328 Midwestern 169 $45 $3,463 $1,57 Parkland 148 $43 $2,9 $1,53 Western 254 $438 $6,572 $1,499 Grand Total 1,229 $43 $6,572 $1, Average Arable Land Sale Price per Acre by AMM District $3,2 $3,1 $3, $2,9 $2,8 $2,7 $2,6 $2,5 $2,4 $2,3 $2,2 $2,1 $2, $1,9 $1,8 $1,7 $1,6 $1,5 $1,4 $1,3 $1,2 $1,1 $1, $9 $8 $7 Q1-213 Q2-213 Q3-213 Q4-213 Central $2,495 $2,55 $2,926 $3,45 Eastern $1,577 $1,853 $1,525 $1,527 Interlake $1,314 $1,37 $1,264 $1,686 Midwestern $975 $1,11 $942 $1,223 Parkland $1,21 $1,67 $959 $1,177 Western $1,464 $1,536 $1,369 $1,548

3 Arable Lands Market Trends (continued) 213- Number of Arable Farmland Sales by AMM District Central Eastern Interlake Midwestern Parkland Western Q Q Q Q Provincial Distribution of Arable Farmland Sale Price per Acre $-499 $5-999 $1,- 1,499 $1,5-1,999 $2,- 2,499 $2,5-2,999 $3,- 3,499 Total $3,5-3,999 $4,- 4,499 $4,5-4,999 $5,- 5,499 $5,5-5,999 $6,- 6,499 $6,5-7, This graph shows the distribution of sale price per acre for arable farmland throughout Manitoba. The majority of arable land is selling for $5 to $1,999 per acre, although there have been more sales over $3, per acre than ever before, in some cases, ranging up to almost $7,. The higher end of the range represents sales of land used for special crops such as potatoes, vegetables, and other special crops.

4 Non-Arable Market Trends AMM District Number of Non-Arable Farmland Sales 213-Lowest Sale Price per Acre Non- Arable Farmland 213-Highest Sale Price per Acre Non- Arable Farmland 213-Average Sale Price per Acre Non-Arable Farmland Central 13 $5 $391 $278 Eastern 69 $94 $399 $289 Interlake 94 $63 $388 $238 Midwestern 36 $64 $4 $275 Parkland 79 $43 $398 $26 Western 19 $189 $391 $317 Grand Total 31 $43 $4 $252 The Interlake, Parkland, and the Eastern districts have the highest volume of sales in 213. The provincial average is $252 per acre, and the Eastern district surpasses that, at $289. The greater value in the Eastern district is most likely partially driven by the demand for recreational land in its natural state, due to its proximity to larger centres in the Capital Region. The Parkland district has the lowest average at $26 per acre. $ Average Sale Price per Acre for Non-Arable Land by District $3 $25 $2 $15 $1 Q1-213 Q2-213 Q3-213 Q4-213 Central $264 $275 $268 $312 Eastern $281 $33 $272 $315 Interlake $254 $23 $228 $248 Midwestern $282 $38 $225 $25 Parkland $214 $26 $197 $173 Western $324 $333 $189 $312 Overall, the average sale price per acre shows the trend in market value for non-arable land remains flat, with not much change between the first and last quarter averages. Increased cattle prices may influence this trend upwards in 214, but confidence in this price stability has to first be regained for ranchers to start expanding their existing land holdings. Time is needed for cattle producers to regain a positive financial position after the last decade of poor cattle prices.

5 Non-Arable Market Trends (cont d) 213-Number of Non-Arable Land Sales by District Central Eastern Interlake Midwestern Parkland Western Q Q Q Q Provincial Distribution of Non-Arable Farmland Sale Price per Acre $-$49 $5-$99 $1-$149 $15-$199 $2-$249 $25-$299 $3-$349 $35-$4 Total This graph shows that the distribution of non-arable market values throughout Manitoba. The majority of non-arable land sold from $2 to $4 in 213.

6 Improved Farm Sales Market Trends Improved farm sales include sales of agricultural land improved with farm residential and agricultural buildings. Sales of land & buildings, had to have a parcel size of 8. acres and up, in order to be included in this analysis. The size restriction was to try and exclude rural residential properties from the analysis. The Eastern district had the highest sales volume, with the Central district having the highest average sale price in 213. AMM District 213 Improved Farm Sales - Average Size in Acres 213 Improved Farm Sales -Lowest Sale Price 213 Improved Farm Sales - Highest Sale Price 213 Improved Farm Sales - Average of Sale Price Central $48, $3,493,36 $89,929 Eastern $3, $3,9, $412,277 Interlake $25, $2,995, $349,678 Midwestern $5, $2,793,6 $45,98 Parkland $37, $1,695, $433,724 Western $21, $4,39,25 $46,911 Grand Total $21, $1,695, $48, Number of Improved Farm Sales (8 acres & up) by District Central Eastern Interlake Midwestern Parkland Western Q Q Q Q

7 Improved Farm Sales Market Trends (Cont d) 213 -Size in Acres of Improved Farm Sales - Entire Province The distribution by size shown on this graph demonstrates that the majority of sales appear to be farmers adding to their existing farms, rather than the purchase of entire farming units ,12 1,12-1,28 Total ,28-1,44 1,44-1,6 1,6-1,76 1,76-1,92 1,92-2,8 2,8-2,24 2,4-2,56 1,56-1, SALE PRICE OF IMPROVED FARM SALES - ENTIRE PROVINCE The majority of improved farm sales are under $499, There have been some sales of large farming units, but these appear to be the exception rather than the rule

8 Debbie Pieterse, B.Sc. Agric. AAM DULE Debbie Pieterse has been an Appraisal Consultant with Stevenson Advisors Ltd since 213. She specializes in agricultural appraisals and rural properties, expropriations, real estate consulting, valuation, and market analysis. Debbie grew up on a cattle farm in the Ashern area, which started her lifelong interest in the agricultural industry. She attended the University of Manitoba and graduated with a Bachelor of Science in Agriculture with an Animal Science major. After university, Debbie embarked on a long career with the Province of Manitoba, mainly with the Assessment Services Branch. Throughout her time at assessment, she held the positions of Assessment Officer, District Supervisor (Dauphin) and Provincial Sales Manager. She valued properties throughout rural Manitoba, working in the Souris, Portage la Prairie, Dauphin and Brandon District Assessment Offices. While employed with Crown Lands & Property Agency as a property appraiser, she prepared valuations for expropriations, acquisitions and disposal of Crown Property throughout rural Manitoba. She became an Accredited Assessor of Manitoba in Debbie is currently enrolled in the Appraisal Institute of Canada (AIC) Education Program through the University of British Columbia program and was awarded the Certificate Real Property Assessment and Diploma of Urban Land Economics (Assessment Specialization) in 212. Debbie was the recipient of the 212 BC Assessment Valuation Award, with the highest standing in Foundations of Appraisal and Statistical and Computer Applications in Valuation. For specialized agricultural market analysis, appraisal or consulting related inquiries, please contact: DEBBIE PIETERSE Stevenson Advisors Ltd St. Mary Avenue Winnipeg, MB R3C M6 Phone: (24) dpieterse@stevenson.mb.ca For updates on the Winnipeg & Manitoba real estate markets, follow us on twitter, click on the icon below The agricultural sales data as analysed in this newsletter is sourced from the Province of Manitoba - Department of Municipal Government, Assessment Services Branch sales report. This report is published six times per year for the use of subscribers. The sales information was collected from these reports, but no investigation was done of the sales to determine whether or not they were valid armslength sales. This document has been prepared for general information only. Stevenson Advisors makes no guarantees, representations or warranties of any kind, express or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. Stevenson Advisors exclude unequivocally all inferred or implied terms, conditions and warranties arising out of this document and excludes all liability for loss and damages arising therefrom.