What Happened

The average Canadian household’s net worth surpassed $1 million in 2025, marking a 37 per cent increase from 2019 levels. This surge was driven primarily by a growing millionaire population that expanded by 30,000 individuals during the year. The expansion of this wealthy cohort was fueled by a surging stock market and rising commodity prices across the country. However, this national aggregate masks significant disparities in how wealth is distributed and utilized. Statistics Canada data reveals that the wealthiest 20 per cent of households now hold 68 per cent of all financial assets and 51 per cent of real estate. This concentration has pushed the income gap in Canada to its highest level on record as of early 2025. Despite these headline numbers, financial stress remains acute in specific pockets of the population. Higher debt loads combined with lower wage growth mean many Canadians are living on the edge despite technically richer balance sheets. In British Columbia, borrowing has slowed in recent years, which has helped ease debt levels that were previously the highest among provinces prior to the pandemic. Meanwhile, spending in B.C. reached the highest level among provinces, supported by stronger financial market gains and above-average income growth. In May 2025, Canadians took 1.9 million return trips to the U.S., a 9.5 per cent increase from the previous year. This rebound in travel was largely driven by a 15.1 per cent increase in automobile trips, while air trips dropped by 5.5 per cent. Royce Mendes, head of macro strategy at Desjardins Group, noted that the Bank of Canada’s policy will not respond to weakness in home prices anytime soon. Solovieva from TD highlighted that borrowing trends in B.C. have shifted, easing previous debt pressures. The data suggests that wealth gains do not automatically translate into financial resilience for all households.

Why It Matters

The divergence between rising national net worth and persistent household stress highlights a critical vulnerability in the Canadian economy. While the average household appears wealthier, the concentration of assets among the top 20 per cent means that the majority of Canadians are not benefiting from the same financial security. This disparity affects consumer confidence and spending power, particularly in regions where wage growth has lagged behind asset inflation. For the housing market, this dynamic is crucial because it indicates that demand may remain fragile despite headline wealth numbers. If wealth is concentrated in financial assets rather than liquid cash or home equity accessible to the middle class, the stimulus effect on the broader economy is limited. Furthermore, the Bank of Canada’s stance on not adjusting policy for home price weakness suggests that monetary tools may not be effective in addressing the underlying debt issues facing lower-income households. This creates a scenario where monetary policy remains tight, potentially suppressing housing demand even as asset prices rise for the wealthy.

Local Vancouver / Burnaby Context

In British Columbia, the wealth dynamic presents a complex picture for the local real estate market. Prior to the pandemic, B.C. had the highest household-debt-to-income ratio among the provinces, a structural issue that continues to influence buyer behavior. Although borrowing has slowed in recent years, easing some of this debt pressure, the region’s financial resilience remains tied to income growth and market performance. Household disposable income gains in B.C. have trailed those in other provinces, yet spending reached the highest level among provinces due to stronger financial market gains. This suggests that B.C. residents are relying more on asset appreciation than wage growth to maintain consumption levels. For Burnaby and Vancouver, this means that housing demand is increasingly driven by those with access to financial markets rather than traditional wage earners. The high concentration of real estate wealth among the top 20 per cent of households nationally also impacts local inventory, as wealthy owners may hold properties longer, reducing turnover. Additionally, the shift in travel patterns, with a significant increase in automobile trips to the U.S., may reflect cost-of-living pressures or cross-border shopping behaviors that impact local retail and service sectors. The lack of policy response to home price weakness by the Bank of Canada further complicates the outlook for B.C. buyers, who face high debt levels and stagnant income growth relative to national averages.

Market Impact

The concentration of wealth among the top 20 per cent of households suggests that the luxury and high-end real estate markets may remain resilient, while the mid-market faces continued pressure. For owners, the rise in net worth may provide some equity buffer, but for those with high debt-to-income ratios, the impact is minimal. Renters may see limited relief as wealth concentration does not necessarily translate into increased rental supply. The slowdown in borrowing in B.C. indicates that credit availability or willingness to take on debt is a key constraint for potential buyers. This could lead to a stabilization in price growth rather than a decline, as demand is capped by affordability rather than a lack of interest. The Bank of Canada’s stance on not responding to home price weakness implies that mortgage rates may remain elevated, further dampening liquidity in the condo and detached home markets. Investors may find it challenging to generate returns in a high-debt environment, while sellers may face longer listing periods as buyers remain cautious.

Builder / Developer Perspective

For builders and developers, the data indicates a bifurcated market where demand is driven by the wealthy rather than the average household. The slowdown in borrowing in B.C. suggests that financing for new projects may become more difficult or expensive, particularly for mid-market developments. The high concentration of real estate wealth among the top 20 per cent may lead to a focus on luxury projects that cater to this demographic, while mid-market affordability remains a challenge. Developers must navigate a landscape where monetary policy does not support price weakness, meaning that pre-sale strategies may need to be more conservative. The rise in net worth among millionaires does not necessarily translate into increased construction activity, as this group may prefer existing assets over new builds. Additionally, the high debt levels in B.C. mean that potential buyers are more sensitive to interest rate changes, requiring developers to offer flexible financing options or price points that align with current borrowing capacities.

BurnabyHouse Insight

The headline number of $1 million average net worth is misleading for most Metro Vancouver residents. The reality is a market where wealth is heavily concentrated, and debt levels remain a critical constraint. For Burnaby and Vancouver, the key takeaway is that housing demand is no longer driven by broad-based income growth but by asset appreciation among the wealthy. This creates a fragile market where price stability depends on the continued performance of financial markets rather than fundamental housing demand. Developers and buyers alike should prepare for a prolonged period of low liquidity and high sensitivity to interest rates, as the Bank of Canada’s policy stance offers no immediate relief for home price weakness.