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HomeMy WebLinkAboutThe Lucknow Sentinel, 1989-03-08, Page 23bsentee lan BY MONA IRWIN Sometimes the houses and barns are left standing. More often they're razed to the ground - because the new landowner doesn't plan on living there, even during summer vacations. Weeds have taken over what used to be productive acres, and what was once the family g+rden has also disappeared in the tangle. It's a fairly recent - and to many, wor- risome - development in the agricultural community: absentee landlords, who buy fertile farm land as an investment. It's become prevalent enough, say critics, that some concessions that used to be end- to-end working farms have been complete- ly emptied : of buildings, of people, of livestock. However, others say the number of absentee landlords is too small to worry about. The issue, also referred to as `foreign ownership,' began to gain notice in the mid to late 1970s. But there are two different types of foreign ownership, says Ken Kelley, an executive committee member with the Bruce County chapter of the Ontario Federation of Agriculture. "There's the situation where someone who's immigrating from another country arranges to buy a farm to work on it," Kelley said. 'I doubt that anyone's seriously concerned about that. "Of primary concern are the foreign in- vestment types, who buy farmland as an in- vestment. They have no intention of taking up residence there." Absentee randl-or yttralanitstrictly as a speculative commodity, agrees Tony McQuail, who operates a mixed family farm in West Wawanosh Township. Farm Edition '89 ® Page 3 rds: A growing problem? "They're not living in the community, and they're not putting anything into the com- munity except the money they used to buy the land. They're not a part of the communi- ty - they're not there at all," McQuail said. ut Donald Dunn, director of the Woodland Preservation Branch of the Ministry of Agriculture, said evidence in- cates there has actually been a decrease in the amount of agricultural and held by non-residents. wanted to avoid the Land Transfer Tax, said Dunn. Under the LTTA, non-residents who ac- quire farmland must pay a tax equalling 20 per cent of the value of the farm when it was sold. "Normally residents pay less than one per cent (tax) when they buy property," Dunn said. Both Dunn and Ontario Minister of Agriculture Jack Riddell say that the ma - Who owns the "At the end of 1988, there were 148,000 acres" in Ontario owned by non-residents, Dunn said. "That's less than one per cent of all the agricultural land in the province." The total has been as high as 165,000 acres in previous years, he added. One of the re✓asuns-for that -decrease is - that in 1983 an amendment to the Land Transfer Tax Act closed a loophole being us- ed by representatives of investors who jority of people buying land today - at least 90 per cent - plan to farm it. A few companies, most Canadian -based - dealing in development, agribusiness, petro -chemicals or gravel - "may acquire parcels from time to time," but that ac- counts for a small amount of land, Dunn said. "The majority (of land buyers) have ex- pressed an interest in coming and farming the land," Riddell said. "Very little land is being bought as an investment. presently have an adequate supply of SPRING CEREAL SEED to meet your requirements. Certified Donald Oats Certified Ogle Oats Certified. Leger Barley Certified MicMac Barley Certified Herta Barley Certified Birka Barley Certified Rodeo Barley Certified Mingo Barley Certified Helena .Barley Iimmi ants are required to put up securi- ty on the land they buy, and if they don't live on the land and farm it within a year of the date they arrive, they forfeit the security asp well as having to pay the Land Transfer Tax. If they do operate the farm within that time, they get their security back. "Last year there were 8,000 acres in Huron County registered by foreign owners," said Riddell. "But those people in- tend to come here and farm. We certainly don't want to discourage that." RISING PRICES Critics say that one of the results of such investment speculation is steadily increas- ing land prices. High land prices are a boon to some, in- cluding retiring farmers, Kelley admitted. "An older farmer who wants to retire needs the highest possible selling price" to provide a retirement fund. But for beginning farmers, or farmers ex- periencing financial difficulty, the fast - rising prices are making it steadily more difficult to cope. Those :who want to farm usually have far less finaii'ia1 backing than those who want simply to invest, said McQuail. "Local people can't start up a farm," he said. "Or they have to pay a price that's so high they won't be able to recoup the cost from the land." "If you pay a high cost for the land, you either need a lot of money to start farming, or you have to pass (the cost) on to the con- sumers," Kelley said. And neither option is really feasible for Ontario farmers. "For example, in Mexico they can grow tomato -an -Hon -Y.' , ,_:. -4 : .rt, them - 99. are like, but the labor cost is way below what it is here. "So the Mexican tomatos can come in Turn topage 8• A E YOU OF PAYM F YOU FA rNi TA ETL YEA!'S IN DVANC i? Certified mixtures of the above varieties are available custom mixed to your specifications. 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