Canadian households may feel economic uncertainty, but the good news keeps rolling in. Statistics Canada (Stat Can) data shows that household net worth made a big jump in Q4 2024. In fact, every quarter in 2024 saw households gain more wealth as higher rates suppressed debt while wealth growth advanced. Unfortunately, it wasn’t a win for everyone—the divide between the country’s rich and poor is getting wider.
Canadian Household Net Worth Surges To $17.5 Trillion
Canadian households saw their net-worth rise at a fairly brisk rate in 2024. Household net worth climbed 1.4% (+$236.3 billion) to $17.5 trillion in Q4 2024. The agency notes that household net worth advanced in all four quarters last year, with 2024 ending 7.3% (+$1.2 trillion) higher than the year before. Annual growth remains substantial even after adjusting per capita (~5.0%), and for inflation (~3.2%). In fact, it was one of the biggest quarters in years.
Canadian Household Wealth Is Growing Faster Than Usual
The annual growth rate was slightly (-0.3 points) slower than the previous quarter. However, it was still the second highest rate since Q1 2022, and managed to come in 0.5 points higher than the 10 year average. In other words, growth is slowing but it’s still advancing at a faster rate than normal.
Canadian Households Inequality Is Rising Once Again
The agency made a special note of the widening gap between the country’s rich and poor. Stat Can hasn’t crunched the numbers for the quarter yet, but did emphasize that 68% of financial assets were held by the top 20% of households in Q3. The ratio advanced in the first 3 quarters of 2024 to hit the highest share since 2021, and is likely to have moved higher by the next report.
Despite the common narrative, it’s worth noting that falling interest rates tend to boost financial assets. Since this wealth is so heavily concentrated in Canada, the country’s wealthiest households will capture two-thirds of the gains. That’s likely to drive further inequality, a well-studied and proven issue—even though officials frame falling interest rates as an improvement for the average household.
The massive increase in this measure shows the disaster of misuse of agressive monetary policy to destabilize the overall exonomy. Despite persistent inflation and monetary expansion will drive leveraged wealth (real estate, investments, etc.) While investment and wealth generation from non cyclical (non interest rate sentive) is moved into what are less productive investments.
So despite a big jump in nw, once the fmv of canadian dollars and collateral are co sidered, this is almost exclusively monetary expansion and inflation.
Stats Can’s a joke. In every report they indicate that real estate is the number one driver of young adult wealth, but the clowns don’t seem to realize that only the top 20% of income earners can buy real estate. LOL.
Imagine—a group of statisticians that don’t understand cause doesn’t equal effect with just rudimentary surface data. q
This is excellent news and is proof that housing is important, the most important, and prices need to be protected and supported by both government policy and the bank of Canada.
Lower interest rates will increase house prices generating even higher wealth. BoC needs to continue with rate cuts to drive this wealth higher.
It’s always the people who don’t understand the basics like “what are financial assets?” that have the best advice. There’s a reason the Middle Class is the Middle Class—their primary asset is the primary liability of the upper classes.
You are joking, right ? An easy way to figure out if we’re wealthier now is to ask ourselves the following question: What percentage of your salary goes towards a house in 2025, compared to say 2000 ? Did salaries quadruple in the last 25 years ? We all know the answer.
Low interest rates don’t create wealth, they create bubbles. We are currently in the 2nd biggest real estate bubble in the world, which makes absolutely zero sense since we are the 2nd biggest country in the world. And remember that, by its own definition, a bubble will eventually pop. Always.
I think Paul was being sarcastic.
If not, yikes!
Stop immigration and that will kill real estate prices. That’s all Canada has now. Birth rates are 1.3 child per woman, in other words Canada is a dead country but why? Because of overaggressive population growth from immigration greater than in African countries with high birth rates. Look up rat paradise; that is where we are now. This is what you get when criminal politicians that are extremely corrupt destroy the fabric of a given society for profit. I truly hope Canada collapses into a hyper deflationary depression and I hope these politicians for the last 20 years are charged with treason.
I think the Q1 results are going to show a significant drop in personal wealth. Hopefully Q2 will show some recovery.
Ummm, wouldn’t holding anything of inflationary value rise during periods of high inflation? If you had a ton of cash in the bank during this period, your wealth would deteriorate. If your wealth was in real estate, your wealth would grow.