Everyone dreams of buying their dream house, however, those aspirations are far out of reach for many, including Canadians.
And according to a recent study from RBC, not owning a home could actually hurt you in the long run as Canadian renters apparently face more challenges accumulating wealth than homeowners.
According to the financial institution, home ownership is the top way to stack a person’s wealth in Canada. That’s because almost half of household wealth amassed over the past 30 years were a direct result of residential real estate.
Sounds like an easy enough fix to just buy a house, right? The only problem is home ownership is just not an option for some.
In fact, 68 per cent of Canadian households can’t afford to purchase a home based on their income alone.
“Canadian renters are devoting a greater share of their take-home pay to housing costs, much more than homeowners. Many renters may not be able to enter the housing market with the limited scope to save for a down payment. As a group, renters spend more than they earn,” the report reads.
In the third quarter of 2023, both homeowners and renters saw declines in net wealth, the study says. However, renters bore the biggest brunt.
Additionally, home ownership rates are still pretty high among Canadians, because two-thirds of the population own residential real estate as of 2022.
Still, as affordability gets worse there’s only more bad news for people looking to squeeze into the housing market.
