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Land ownership and cycles in land prices

I’d like to start this column by thanking readers who have sent a letter and book order in the past year or so. The letters are the fun part of writing this column and great encouragement to keep scribbling. And, I learn something in the process — I now know where to find Keoma, Alta. (northeast of Calgary), Lillooet, B.C., and Stump Lake, Sask. My Saskatchewan geography is pretty good but I had Stump Lake (Near Prince Albert National Park) mixed up with Scout Lake which is in the deep south.

Each Christmas season I spend an afternoon in the University of Saskatchewan main library picking reading material on a particular topic. This year it was the Enclosures Act(s) in England. I ended up with half a dozen books dealing with Enclosures and other aspects of the history of agriculture in the “Old Country.”

In the early days (1300-1700), land was farmed in an open-field system. Possession was nine points of the law. Little patches here and there were cultivated by whoever got there first and grazing was a communal effort. Enclosure was done by acts of Parliament “enclosing” a parcel of land for a specific individual. The boundary of that parcel was marked by hedge rows or stone fences — still visible throughout England. I have taken many tours courtesy of Google Earth. If you put Sandringham, Norfolk, U.K. into Google Earth, the Queen’s country estate pops up, although it is not labelled as such. (Download free Google Earth software at earth.google.com, or see another version online at maps.google.ca).

It turns out the Enclosures Acts were hundreds of acts of Parliament, mostly between 1750 and 1850. I encountered some very interesting quotes in my reading and I relate them to you as follows:

“Under the open-field system one man’s idleness might cripple the industry of 20; only on Enclosed farms, separately occupied, could men secure the full fruit of their enterprise.”

And: “The poor man who is monarch of but one enclosed acre will receive more profit from it than for his share of many acres in common with others.”

It gets better. “The magic of property turns sand into gold,” and, “It is no accident that the Industrial Revolution followed upon the Enclosures.”

Entering a bubble?

As our great western Canadian prairie lands enter a new era in land ownership, some think we are on the cusp of an era never before realized: Watch out!

Here is another quote “Money made from farming had been eagerly reinvested in improvement of the land. For the same purpose banks had advanced money to occupiers on the security of crops and stocks which every year seemed to rise in value.” The year of that statement was 1813.

A very few years later depression had devastated the industry. Then this quote comes along: “The men who survived the struggle were rarely the old owners… They were rather their fortunate successors who entered on the business of land cultivation on more favourable terms.” That is, they bought land after the bubble had burst.

Some readers may be long enough in the tooth to remember the legendary University of Saskatchewan Agricultural Economist — the famous Hadley VanVliet. His famous quote was “The biggest thing that determines a person’s success in farming is when they were born” — in other words what part of the cycle they entered the industry.

I may be dead wrong. But I think many who start out farming by paying $1,500 per acre for Weyburn loam or $1,800 for Regina heavy clay will not make it. Just yesterday I saw a news item on TV where the “Dirt Auctioneer” auctioned off an Iowa corn farm — the final price was north of $10,000 per acre. If that is not a huge bubble I do not know what is.

The other thing that happens at times like this is that low quality land is lumped in with better quality to bring down the overall per acre price. Watch out for salt and sand — especially salt. My recommendation for the solution to salty land has always been; “Sell it in the winter time!” And it happens all the time.

This time is not different

Many are saying “this time is different”. I do not believe that. Land price cycles go all the way back to 1813 and beyond.

I have been getting some scary phone calls lately. The younger generation thinks that, with all those mouths to feed, land prices will go up forever. So, if you are in the market for land be very careful. †

About the author

Columnist

Les Henry

J.L.(Les) Henry is a former professor and extension specialist at the University of Saskatchewan. He farms at Dundurn, Sask. He recently finished a second printing of “Henry’s Handbook of Soil and Water,” a book that mixes the basics and practical aspects of soil, fertilizer and farming. Les will cover the shipping and GST for “Grainews” readers. Simply send a cheque for $50 to Henry Perspectives, 143 Tucker Cres., Saskatoon, Sask., S7H 3H7, and he will dispatch a signed book.

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