CashNews.co
Younger Canadians’ median net worth grew dramatically between 2019 and 2023, propelled by a significant rise in home ownership, according to new data from Statistics Canada.
Results from the 2023 cycle of the agency’s Survey of Financial Security show the median net worth of Canadian families where the highest earner was under 35 years old jumped from $56,400 in 2019 to $159,100 in 2023, an increase of around 180 per cent.
The median value represents the exact middle for the cohort, with half the members of the group having a net worth greater than the median amount, and half having a net worth less.
Home ownership among the under-35 cohort went from 35.8 per cent to 44.4 per cent, the largest per cent increase of any age group. “We definitely have a lot more younger homeowners,” said John Nicoletta, chief of Statistics Canada’s Centre for Income and Socio-Economic Well-Being Statistics, in an interview with Yahoo Finance Canada.
The data stand in contrast to some recent surveys that show a decline in home ownership for younger age groups. The Statistics Canada sample is 40,000, double the size of previous cycles, and much larger than typical consumer surveys.
The increase in home ownership — which has become a very high priority for younger Canadians — as well as a pronounced rise in home values in recent years, are likely the main factors behind the substantial increase in the cohort’s median net worth, Nicoletta says.
Similar factors are at play for other age groups, Nicoletta points out. “We’ve seen some pretty good growth in the net worth,” he said. “Not so much so when we were looking at 2016 to 2019, when we last released the estimates. But now with these 2023 results, you can see some very statistically significant increases across a lot of these cohorts.”
Canadians’ overall median net worth rose from $381,100 in 2019 to $519,700 in 2023, a 36 per cent increase, according to the data. The data were adjusted to constant 2023 dollars, Nicoletta notes, so the comparison takes inflation into account.
The survey underlines the centrality of home ownership to many Canadians’ wealth, as well as the stark differences among those who do and do not own homes. “By far, the home is the one that does kind of bring more net worth value to those that own them,” Nicoletta said. “And the pension plans are definitely second place, for sure.”
The survey found that the median net worth in the 55 to 64 cohort was $1.4 million for those who owned their homes and had an employer-sponsored pension, versus around $12,000 for those who had neither.