One of the many reasons homeownership is the dream of most Canadians is its contribution to wealth-building. At the end of October, Statistics Canada released new results of the 2023 cycle of the Survey of Financial Security (SFS) Here are a few of the findings.

• Canadians aged 55 to 64 who own a principal residence and have an employer-sponsored pension plan had a median net worth of approximately $1.4 million more than those who have neither. Renters in that age group with no employer pension had a median net worth of just $11,900.
• Families who had an employer pension plan, but who did not own their principal residence, had a median net worth of $359,000. Those who owned their principal residence but did not have an employer-sponsored pension plan had a median net worth of $914,000. Quite a difference.
• Usually, families build up their assets and reduce debts during their working years, then use their assets during their retirement years. Those who have low net worth might need to work into their retirement years, require more government support, or even have a greater risk of poverty.
• Even the youngest homeowners had a net worth measuring more than 10 times that of renters. The lowest net worth members of this group were those who did not have an employer pension or own a principal residence.
• For those who owned homes in 2023 where the highest income earner was 35 to 44 years of age, the median net worth was more than 10 times that of renters ($673,000 versus $61,200). Those between the ages of 45 and 54 had a median net worth of $972,200 versus $50,800 for renters.
• As so many young people are priced out of the homeownership market nowadays, they are looking around for other avenues to amassing wealth, such as RRSPs and Tax-Free Savings Accounts.

Opportunities to build wealth

In addition to all of this, Canadians who purchase homes enable other opportunities that help them build wealth. For example, we have a GST/HST rebate for those who buy a new home. First-time buyers in Ontario may qualify for a Land Transfer Tax Rebate. The Home Buyers’ Plan enables people to withdraw from their RRSPs to build or buy a qualifying home. Budget 2024 raised the limit from $35,000 to $60,000 (some conditions apply).

For many Canadians, owning a home is more than a potential wealth builder; it brings with it a sense of putting down roots, of belonging. It is also a tangible asset, as opposed to stocks and bonds, which are difficult to understand. People can touch, see and live in their homes. They understand the real estate practices of buying and selling. And when you consider appreciation over time, real estate ownership is historically lucrative.

Net worth

Over the years, and for many generations, homeownership has been a big part of amassing assets that increase families’ and individuals’ net worth. When considering how to build wealth yourself, remember that owning a home(s) is investing in your future in more ways than one. So, stop dreaming and make it happen.