Your browser is not supported. We do our best to optimize our websites to the most current web browsers. Please try another browser.
Skip to main content

Canadians Will See the Biggest Drop in Net Worth On Record, RBC Reports

Person with black piggy bank and coins

It’s no secret that Canada is predicting a recession in early 2023. With this in mind, it’s important to understand why it’s happening and what this means for your finances.


According to a new report by RBC, Canadians amassed $3.9 trillion in net wealth thanks to a roaring housing market and a surging stock market during the pandemic. In fact, the study found that the real estate boom drove some home values 52 percent higher.

But right now, the market is experiencing a drop in those gains. The report states that the housing-charged boom in Canadian net wealth is now over. As a result, Canadian net worth will fall at the fastest pace in decades.

“The dramatic decline in net wealth, combined with rising prices and higher interest rates, will cut roughly $15 billion from household spending in 2023,” the report states. “This is one of the factors that will drive Canada into a recession early next year.

Related: This is How the Average Canadian’s Net Worth Stacks Up to Home Sale Prices – by Province

Real estate agent talking to a couple
Getty Images


Preparing for a recession

Looking back on the pandemic, economists found that renovations and home furnishings helped drive the initial consumer spending recovery after pandemic lockdowns. Remember how many people were improving their newly minted home offices, revitalizing their backyard into a staycation paradise, or outfitting newly-purchased homes?

As a result of the interest rate hike on mortgages and inflation, more Canadians need to prioritize essentials like groceries, gas and paying off their debt (including their mortgages). While higher interest rates could mean a higher mortgage payment for many, the silver lining is that it continues to cool down Canada’s housing market. With fewer bidding wars and less extreme housing prices, there’s a chance a first-time buyer’s dream home might be within reach one day after all.



Feature image courtesy of Pexels. 

Latest News

Pulling off a no-grass backyard can be simple with these creative landscape design ideas
June 21, 2024
Elevate your caffeine routine with the perfect at-home coffee bar, thanks to this comprehensive guide.
June 20, 2024
You don’t have to splash out on monogrammed beach towels or furniture sets moulded from gold.
June 19, 2024
If you've got any of these home decor items in your home, it's time to consider donating them... pronto.
June 17, 2024
Thinking about taking the investment property plunge? Here's what you need to know, from maintenance to capital gains.
June 17, 2024
Celebrate Pride in full colour with this vibrant DIY candle holder, made mostly of upcycled materials.
June 14, 2024
Jennifer Lopez and Ben Affleck are selling their luxurious Beverly Hills estate for an estimated $65 million.
June 13, 2024
Make laundry day more enjoyable (and efficient) with these small laundry room ideas.
June 13, 2024
Add these non-toxic cleaning products to your Amazon cart for a healthier home.
June 12, 2024
This content is restricted to adults of legal age.
Please enter your birthdate to confirm.
Date of Birth