Renters have harder time accumulating wealth than homeowners: RBC economist
BNN Bloomberg
An RBC economist says Canadian renters are devoting more of their income to housing costs compared with homeowners, making it harder for them to accumulate wealth and threatening to widen inequality between renters and homeowners.
A new note to investors from Carrie Freestone paints a picture of the Canadian real estate landscape where nearly half of Canadian wealth accumulation has been driven by home ownership for the past three decades.
She says homeowners saw their net worth grow from nine times household disposable income to 13 times since the fourth quarter of 2010, but renters only saw their net worth increase from three times to 3.5 times over the same period.
She doubts many renters will be able to enter the housing market with the limited ability they have to save for a down payment because many renters spend more than they earn.
