Before purchasing properties on PEI, here is some helpful information;
- Land prices vary between $3,500 and $6,300 per acre (wooded land significantly less).
- Any property that is for sale with waterfront or with more than 5 acres, must go through our Island Regulatory Appeal Committee (IRAC). This is so islanders and non-islanders have an equal chance to purchase a property. Information and applications regarding the PEI Lands Protection Act can be found at http://www.irac.pe.ca/land.
- PEI has a 1% property transfer tax on property purchases. Only your first property up to $250,000 is exempt.
- If you’re looking at purchasing a farm on PEI, you should be prepared for a 35-40% down payment.
- When purchasing a farm on PEI and you are a non-resident, we recommend you use an accountant who can help you with the Allocation of Funds. This can be very helpful as your application to IRAQ costs 1% of the price of the land & buildings. Not the entire purchase price (quota/cattle/inventory/machines).
- Appraisals need to be completed for all farm properties on behalf of the Buyer, or if applicable, the bank.
If you are interested in a crop/potato farm, there are several good crops you can grow on PEI.
For those farmers interested in potatoes, Cavendish Farms has the contracts on PEI. However, with any purchase of crop farms, contracts never transfer. A contract needs to be personally negotiated with Cavendish Farms OR you have the option to sell on the open market. This is also quite common on PEI.
PEI potato board (www.peipotato.org)
If you are interested in a dairy farm in the Maritimes, it’s good to know that we still have the quota system. This is a very protected system which guarantees Canada better milk prices. Our government only allows 3% of the market to be imported, which is mainly for speciality cheeses. The price of the quota and the price per litre of milk is determined by the cost of production and demand & supply.
Dairy farming on PEI is one of the most profitable farm commodities due to the supply management system.
Price of quota currently sells for $24,000 per kg.
The PEI Dairy Board (www.dfpei.pe.ca) operates the Quota Exchange and Quota Lease Exchange for producers, control the production and marketing of all milk, and much more. When purchasing a dairy farm, a quota transfer MUST be requested through the PEI Diary Board.