ON vs AB Rural Home Prices.

Being licensed in two provinces has given us access to excellent information on the rural real estate market in both Alberta and Ontario.

The differences between sale prices, the number of sold listings and how long it takes to sell rural listings across both provinces has been an interesting comparison – especially in the current market climate.

Without looking at the data, most people would guess that their money would go quite a bit further out west… Well, at least in Alberta.

We broke down the average sale prices across various acreage ranges in both provinces to see how true this is.

For rural type properties with .5 acres and more, Alberta came in at 5 months, and Ontario came in at about 7.3 months for the same property type. Indicating a relatively balanced market in Alberta but a much stronger buyers market in Ontario – at least for this property type.

Throughout this article it is important to remember that the rural real estate market should not be used as a representation of the entire real estate market.

For instance, OREA reported “months of inventory numbered 4.2 at the end of September 2023” in Ontario, while Alberta’s months of supply came in at 2.36 months for the same period. This paints a different picture when looking at all real estate types compared to just one sector of the real estate market. But our focus is rural so that is the information we are bringing to you!

Both Ontario and Calgary have some truly incredible rural living options.

For the sake of this article we are looking at rural properties within an hours radius of Toronto vs. Rural properties within an hours radius of Calgary.

The below data is take from the period of Jan 1 2023 – November 1st 2023.

TORONTO:

CALGARY:

None of the above data is particularly shocking.  While it would be a stretch to say Alberta is “cheap”, it certainly offers significant discounts on pricing when compared to Ontario across the board.

Looking at the above average sales prices, we see the highest number of sales in Ontario was in the 0.5 – 1.99 acre range, where as in Alberta it was in the 2 – 4.99 acre range. Interestingly,  Alberta also came in over $100,000 less for double the property size.

The largest price difference was noted on the large acreages though. At 100 acres and above. Large properties in Ontario are clearly very expensive in this acreage range by comparison, coming in at over DOUBLE that of Alberta.

The numbers above include properties that were both farmland and equestrian properties. This is an important note because it is not unusual for high end equestrian facilities to be situated on 50-100+ acres of land. These properties fetch a significant premium when they are sold and would be accounted for in the averages above.

Not only that, it is becoming more common for farmland in Ontario to sell as buildable land for subdivisions and suburban sprawl. If a piece of land within an hour radius of Toronto is developable you can bet it is going to sell for a substantial price.

Ontario had significantly more of both of these types of properties traded than Alberta did for our year-to-date data above. 

To get a better understanding of actual farm prices we looked at the 2022 FCC report – which specifically covers cultivated land, pastureland and irrigated land. Even still, we see that farmland is significantly more expensive in Ontario.

Farm Credit Canada’s Historic Values Report noted a 10% increase in Alberta’s farmland prices from 2021 to 2022. While Ontario farmland prices increased by almost double that at 19.4%. According to the same report, price per acre came in at $6,340 for Alberta in 2022. While price per acre was a whopping $17,513 in Ontario for the same year. These are Alberta and Ontario wide averages. Alberta has had a few drought years while the Ontario farmland over the last few years have produced very high yields and this would play a part in how the valuable the land is in one area compared to the other.

We all know there are a number of differences between the two provinces, many of which contribute to the difference in housing supply and prices that we see.

One huge factor is the difference in population.

Calgary, Okotoks, Airdrie and Cochrane have a combined population of approximately 1.78 Million people.  The Greater Golden Horseshoe has a population of 9.6 Million people. Simple supply and demand equation. Toronto is also the financial hub of the country.  With 9.6 Million people in and around the Greater Golden Horseshoe, you are likely going to have a greater number of higher net worth buyers with very deep pockets that can pay the premium for these property types.

Another is the difference of geography in the rural areas that are within an hour’s drive of these major cities.

The Greenbelt surrounds the city of Toronto.  Between the Greenbelt and the city there is a large chunk of suburban sprawl all the way around the lake as well, which fills in a lot of the land within an hours drive.  This in turn makes the rural properties closer to the city more expensive simply because of their proximity. Not only that, with Toronto being on Lake Ontario, the hour radius includes a large portion that is not habitable (that is, you can’t actually build on the lake). Whereas our 1 hour radius around Calgary primarily covers habitable land except for a small portion of the mountains and wilderness to the west in Provincial Park lands where your can’t build homes.

Whichever way you slice it, you get more bang for your buck in Alberta, no question about it. 

There may not be as many options to buy, but you also won’t be up against as many buyers when you find that perfect rural home.

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If you are looking to buy out west – we hope you contact us first! We can take care of you here, and there, with a dedicated team and contacts already in place in both provinces.

Search Alberta Rural Homes for Sale HERE

Search Ontario Rural Homes & Equestrian Properties for Sale HERE.