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

Just Posted

Ashcroft under Boil Water Notice

High turbidity levels in the Thompson River have prompted the notice

Prescribed burns to take place around Lytton, Spences Bridge

BC Wildfire Service will only conduct burns if conditions permit

Flooding hits Highway 97 north of Cache Creek

Recent warm temperatures are causing an increase in flooding on area roads

Elizabeth May feels people are looking at the Green Party with new eyes

Green Party leader is hoping for a breakthrough for her party in the October federal election

Cache Creek Softball Association gears up for another season

Organizers are looking for people of all ages from throughout the area

Sparks fly as SUV speeds down wrong side of Highway 1 trying to flee RCMP

Captured on video, the vehicle headed westbound against oncoming traffic before crashing

Calgary captain has 3 points as Flames torch Canucks 3-1

Giordano leads way as Alberta side cracks 100-point plateau

1,300 cruise ship passengers rescued by helicopter amid storm off Norway’s coast

Rescue teams with helicopters and boats were sent to evacuate the cruise ship under extremely difficult circumstances

B.C. university to offer first graduate program on mindfulness in Canada

University of the Fraser Valley says the mostly-online program focuses on self-care and well being

Province announces $18.6 million for B.C. Search and Rescue

The funding, spread over three years, to pay for operations, equipment, and training

Late-season wave of the flu makes its round in B.C.

BC Centre for Disease Control reported 50 per cent jump in flu cases in first weeks of March

Tofino’s housing crisis causing some to seek shelter at the local hospital

Tofino’s housing crisis is pushing the town’s ‘hidden homeless’ population into the forefront.

Sentencing judge in Broncos crash calls for carnage on highways to end

Judge Inez Cardinal sentenced Jaskirat Singh Sidhu to eight years

2 fires in Victoria caused by cigarettes prompts warning from deputy fire chief

Two separate fires caused by cigarette butts were avoidable

Most Read