Renters, owners connect online for landIf the developer of a new farmland website has his way, his company Renterra may become the agricultural equivalent of eBay.
According to owner Lyndon Lisitza, Renterra.ca is Western Canada’s first rental auction website for farmland.
“Renterra provides an effective tool to post, search and bid on available rental farmland through an efficient, transparent auction process,” said Lisitza.
Part of a farming family himself, Lisitza earned a Masters of Economics from the University of Saskatchewan, where he became intrigued by the keys and barriers to market efficiency.
In 2008, he sold his farm to a Calgary energy company that wanted to rent it out to area farmers. When the company called Lisitza and inquired about local contacts, an idea was born in the entrepreneur’s mind.
“Land renting used to be largely by word of mouth, but as farms got bigger, people became disconnected from the market. They may not know who the renters are or what rents the current market will bear.”
For Lisitza, the key to market efficiency is proper price discovery.
“Most transactions today are done by sealed bid or a handshake between neighbours. Our site offers transparency so the market sets a fair price for the land. It also eliminates the time and cost involved in finding land to rent, as well as negotiating both the terms and conditions.”
Farmers looking for land can register, enter the legal land description of their home quarter and specify the perimeter where they’d like to rent. They are then notified when rental land is available in that area. Depending on the detail included by the landowner, they can also view soil class, assessment values, chemical/fertilizer history and yield history. They can even view the rental contract if the landowner has uploaded it.
Graham Sorgard, owner of Sorgard Seeds in Saskatchewan, appreciated the convenience and transparency of the process.
“It’s frustrating when you only find out about available land after it’s been rented,” said Sorgard. “With Renterra, I set up an account and a month later was notified of land that met my criteria. I then submitted two bids and secured five quarters of land. It was that simple.”
Those looking to rent out their land may do so by auction—with the option of including a “buy now” price similar to eBay—or by sealed bid. If they go the auction route, they can set the reserve price so that once it’s reached, the auction is in play. They can also place any number of terms and conditions on the final sale.
“For many landowners, finding someone who will be a good steward of the land is just as important as getting the right price,” said Lisitza.
Gurmail Tung is one such landowner. “I live in Vancouver and wanted to rent out my farm in Saskatchewan. Renterra told me what to expect and what a lease would go for in that area,” he said. “I wasn’t concerned with making a few extra dollars as long as I secured a local, trustworthy tenant for the land.”
Within two weeks, the deal was done. Since launching in December 2012, the site has held 58 auctions involving 70,000 acres of farmland.
While he’s pleased by the numbers, Lisitza plans to eventually integrate his system with the rest of North America.
“It may take a while,” said Lisitza. “But then, so did eBay.”
To register for free or obtain more information, go to www.renterra.ca.