The numbers look good on paper. Canada's household net worth climbed to $17.9 trillion in Q2 2025, marking seven straight quarters of gains. Financial assets hit a record $11.2 trillion. Markets performed well. The S&P 500 jumped 10.6%, and the TSX gained 7.8% during the quarter.

But zoom in closer and the picture gets more complicated.

Nearly 70% of those financial assets sit with the wealthiest 20% of households. The bottom 40%? They hold just 3.3% of the nation's total wealth. That's an average of $85,700 per household at the bottom versus $3.3 million at the top.

These aren't just statistics. They're snapshots of how differently Canadians are experiencing the same economy.

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When Rising Markets Don't Lift All Boats

Statistics Canada put it plainly in their latest report: wealthier households are "best positioned to benefit from investment income and valuation gains when markets perform well."

That's economist-speak for something pretty straightforward. If you own substantial financial assets, stocks, bonds, investment properties, then market gains flow directly to you. Your net worth grows while you sleep.

If you don't own much beyond maybe a home and a modest RRSP, those same market movements barely register in your financial life.

The income gap between the top 40% and bottom 40% of Canadian households reached a record 49 percentage points in Q1 2025. That's up from 43.8 percentage points just four years earlier. The trend didn't start in 2025. It's been building steadily since the pandemic began.

"It's not a surprise," Katherine Scott, a senior researcher at the Canadian Centre for Policy Alternatives, told CBC News. She pointed out that high-income households didn't just weather the pandemic better. "They were in a position to take advantage of the huge run-up of the investment markets that happened at that time and have continued to increase ever since."

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The Real Estate Factor

While financial assets drove most of Q2's wealth gains, residential real estate told a different story. Non-financial assets, heavily weighted toward homes, fell to $17.3 trillion after two quarters of growth.

Royal Bank economist Abbey Xu cited CREA data showing the MLS Home Price Index declined 1.2% in Q2 2025, reversing gains from earlier in the year. Statistics Canada noted that residential values have dropped a modest 0.3% since Q1 2024.

This matters because home equity represents the primary wealth-building tool for most Canadian families. When you're in the bottom 40% or even middle 60% of the wealth distribution, your house is probably your biggest asset. Maybe your only significant asset.

So when housing values soften while stock markets surge, the wealth gap widens. The people who own diversified portfolios capture the gains. The people whose wealth is tied up in their primary residence don't.

Research from the Parliamentary Budget Office found that the richest 1% controls nearly a quarter of Canada's wealth, amounting to $3.5 trillion. Academic studies using similar modeling suggest it might be even higher, at 29% of net wealth.

But you don't need to be a billionaire to benefit from this dynamic. Even within the broader population, housing-driven inequality creates stark divides.

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The Income Picture Gets Messier

The Q2 data showed household savings dropping to around 5% as spending growth outpaced gains in disposable income. That gap tells you something about pressure points in the economy.

People are spending more than their income is growing. Which means they're either dipping into savings or taking on debt.

Unemployment was 6.9% at the end of Q2 in June. By August, it had climbed to 7.1%, the highest in nine years outside the COVID period. TD economist Maria Solovieva noted the headwinds from both disposable income and labor markets.

"That's why we still think that there will be a bit of a slowdown going forward," she said. "But despite all of this, the balance sheet is still strong, so that's a good sign."

Strong for whom, though? That's the question the aggregate numbers don't answer.

The household debt service ratio edged up to 14.41% from 14.37%. The debt-to-disposable income ratio rose to 174.9%, meaning $1.75 in credit market debt for every dollar of disposable income. That's down from the 2021 peak of $1.86, but it's trending the wrong direction again.

Mortgage interest payments increased 0.9% as loans taken out at lower rates renewed at higher ones. For households carrying significant debt, this squeeze is real and immediate.

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Regional Variations Matter

National averages mask significant regional differences. RBC's wealth analysis found that Ontario and British Columbia continue to lead in net worth-to-disposable-income ratios.

That's largely because of expensive real estate markets. Properties in Vancouver and Toronto boost asset values enormously. But they also saddle households with larger debts.

Debt-to-disposable-income ratios exceed 200% in Ontario and approach that level in British Columbia, well above the national average of 182%. Alberta ranks third, still elevated but somewhat lower.

Here in the Okanagan, we see these dynamics play out differently. Kelowna's median single-family home price sits around $1.2 million, up 6% year-over-year despite broader market softness nationally. That puts substantial equity in the hands of existing homeowners.

But it also creates a high barrier for entry. First-time buyers typically need household incomes in the top 5% to afford average properties. The typical entry range runs $600,000 to $800,000, and even that requires financial stretching for many.

January 2025 saw a 41% jump in single-family sales compared to the previous year, suggesting renewed confidence. But inventory has also climbed 21% year-over-year, giving buyers more options and negotiating power.

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Who Benefits From Current Conditions

The data shows clear patterns in who's capturing gains:

Older households are seeing stronger wealth growth than younger ones. Households 35 and under grew wealth by just 2.1% in Q2, and they're continuing to reduce mortgage debt. They're being cautious, which makes sense given labor market uncertainty and high borrowing costs.

High-income groups saw significantly faster income growth in Q1 2025, supported by strong investment returns. The bottom 20% saw wages actually decline 0.7%, and their investment income plunged 35%.

Homeowners in expensive markets have captured significant appreciation over the past decade, even with recent modest declines. If you bought in Kelowna ten years ago, your property value has likely doubled or more.

Renters and those locked out of ownership haven't participated in that wealth building at all. Research shows that nearly half of Canadians now struggle to meet day-to-day expenses, with cost-of-living pressures hitting lower-income groups hardest.

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What This Means for Real Estate Decisions

Understanding these wealth dynamics matters when you're making property decisions. Real estate isn't just about shelter. It's about wealth building, financial security, and positioning yourself within these broader economic patterns.

In markets like Kelowna, where inventory is rising but demand remains relatively strong, buyers have more negotiating room than they've had in years. Properties are taking longer to sell than during the hot market years, typically in the 50 to 60 day range. Sellers are offering discounts from list price in the low-to-mid single digits.

For buyers with strong financial positions, current conditions present opportunities. Interest rates have declined from their 2024 peaks. Inventory gives you choices. And homes priced realistically for current conditions are still selling.

For sellers, pricing matters more than ever. Properties clinging to 2022 valuations tend to sit unsold. The market has adjusted. Your pricing needs to reflect that reality.

For those trying to break into ownership, the picture remains challenging despite improved inventory. The fundamental issue hasn't changed: high prices relative to incomes create barriers that policy tweaks around the edges don't fully address.

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The Inheritance Factor

One trend that doesn't get enough attention: the share of Canadians receiving familial support for homeownership has increased markedly. This includes inheritances, gifts, and family loans for down payments.

As baby boomers age and transfer wealth to younger generations, this dynamic will likely widen inequality further. Some younger households will inherit property or receive substantial down payment help from family. Others won't.

That creates a two-tier system where access to homeownership increasingly depends on family wealth, not just individual income and savings.

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Looking Ahead

The household balance sheet data shows resilience in aggregate. Total net worth keeps climbing. Debt service ratios remain below recent peaks. Financial assets hit records.

But those aggregate numbers hide profound divergence in individual experiences. Some households are thriving, capturing investment gains, building equity, seeing income grow. Others are treading water or falling behind, watching expenses outpace income, unable to save, locked out of wealth-building opportunities.

Statistics Canada data show this pattern continuing through 2025, with household net worth rising and financial assets hitting new records, while wealthier Canadians remain best positioned to capture those gains.

The pattern continues. Markets reward those who already have assets. Labor market challenges and cost-of-living pressures squeeze those who don't.

Real estate sits at the intersection of these forces. Property ownership remains the primary wealth-building tool for most Canadians. But access to that tool has become increasingly unequal.

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At Coldwell Banker Horizon Realty, we help clients in Kelowna and the Central Okanagan make sense of current conditions, understand what's driving pricing trends, evaluate timing considerations, and think through how property decisions connect to longer-term financial goals in an economy where wealth distribution keeps shifting.