Canadians saw their national wealth drop in the last quarter of 2018. The ‘national wealth’ of a single Canadian fell from $304,085 to $296,933. THE CANADIAN PRESS/Graeme Roy

Canadians are getting poorer and are borrowing money

National wealth dropped by more than two per cent to $11.1 trillion, while personal debt rose

Dropping real estate values and natural resource prices have made Canadians poorer.

According to Statistics Canada, the ‘national wealth’ of a single Canadian fell from $304,085 to $296,933 during the last three months of 2018.

This recorded drop reflects a decline of Canada’s national wealth by 2.2 per cent to $11.1 trillion at the end of the fourth quarter.

RELATED: 46% of Canadians $200 or less away from financial insolvency: poll

“This was primarily due to a 23.5 [per cent] decrease in the value of natural resources,” the agency said in a report. Weaker crude oil prices in the fourth quarter accounted for the drop. “A decline in the value of residential real estate [down $72.5 billion] also contributed to the fourth quarter decrease, as housing prices continued to edge down.”

Canadians are also borrowing more money relative to their incomes.

The household debt service ratio, which measures payments on the principal and interest of credit market debt as a proportion of household disposable income, rose 14.9 per cent in the fourth quarter, as growth in total debt payments outpaced the growth in disposable income.

RELATED: 731,000 Canadians going into debt to buy prescription drugs: UBC

Overall, the average Canadian owes $1.79 in credit market debt for every dollar that they earn towards their disposable household income.

A 2017 OCED study found that Canadians borrow far more than the rest of the world. It found Canadian household debt exceeded the total value of Canada’s per-capita Gross Domestic Product by one per cent. In other words, the Canadian economy does not produce enough wealth to cover the private household debts of Canadians, leaving one per cent unpaid if all GDP were to go towards that single item.

According to the OCED, higher-than-usual real estate prices accounted for the global debt leadership of Canadians. Worse, Canadians will find it more difficult to recover the value of their debt-fueled investment against the backdrop of declining real estate prices.


Like us on Facebook and follow us on Twitter

wolfgang.depner@saanichnews.com

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Surrey RCMP look for missing man

Tyler Ridout, 36, last seen near Balsam Crescent and 136th Street

Police watchdog investigating death of man in Delta

Independent Investigations Office asking for witnesses to May 29 incident at Tsawwassen ferry terminal

Safe Surrey under fire for ‘sickening’ social media posts accusing RCMP of murder

Mayor Doug McCallum says tweet, Facebook post ‘sent out by unauthorized person’

B.C. government releases designs for new Pattullo Bridge

Project expected to cost $1.377 billion, completed by end of 2023

QUIZ: Test your knowledge of the world of summer sports

In a typical year, there are plenty of summer sporting events and tournaments held across Canada

Facing changes together: Your community, your journalists

We’re asking you to lock arms with us, as we look to better days ahead

‘We’re sick of it’: Anger over police killings shatters U.S.

Tens of thousands marched to protest the death of George Floyd

Father’s Day Walk Run for prostate cancer will be virtual event this year throughout B.C.

The annual fundraiser for Prostate Cancer Foundation BC has brought in $2.5 million since 1999

Dr. Bonnie Henry announces official ban on overnight kids’ camps this summer

New ban comes after talking with other provincial health officials across the country, Henry says

Senior man in hospital after unprovoked wolf attack near Prince Rupert

Conservation officers are on site looking for the wolf

VIDEO: NASA astronauts blast off into space on SpaceX rocket

Marks NASA’s first human spaceflight launched from U.S. soil in nearly a decade

‘I knew what he wanted’: Kootenay man spends hours in tree as black bear patrols below

Francis Levasseur is no stranger to the outdoors, but a recent run-in with a bear caused quite a scare

B.C.’s police watchdog probing death of Richmond man in alleged shoplifting incident

Independent Investigations Office of B.C. is asking any witnesses to come forward

Most Read