Homeownership, pension plans playing big role in Canada’s wealth gap

Homeownership was the main factor in the difference in net wealth among Canadians surveyed by Statistics Canada, with renters coming out behind on a median basis.

Statistics Canada’s latest financial security survey shows a stark disparity between the wealth of homeowners and renters, even as it fails to capture the true scale what’s owned by Canada’s richest families.

The survey, conducted only every few years, shows home-owning families whose main earner was 55 to 64, and who had an employer-sponsored pension, had a median net worth of $1.4 million in 2023. Renters without a pension plan in the age group had a median net worth of $11,900.

Home ownership was the main factor in the difference, as those who owned their home but didn’t have a pension had a median net worth of $914,000, while those with a pension but did not own had a median net worth of $359,000.

The data released Tuesday also shows Canadians of all income brackets are trying to get into real estate, said Dan Skilleter, director of policy at economic inclusion non-profit Social Capital Partners.

“The most striking numbers they have in here are about just the growth of real estate as an asset class,” he said.

“So it’s clear everyone’s been getting signals about how important that is, and I think that is dysfunctional, and has been leading to an unsustainable situation where real estate has become an essential stepping-stone to really have any financial security in Canada.”

The picture in the report was similar for families whose main earner was under 35, as the median net worth of those who own their principal residence was $457,100, compared with $44,000 for those who don’t.

The gap for young families is even larger than at first glance though, as Statistics Canada notes that of that $44,000 net worth, an increasing amount is due to renters owning real estate that is not their principal residence.