Canada is experiencing the largest intergenerational wealth transfer in its history. The Chartered Professional Accountants of Canada estimated in 2023 that $1 trillion would move from baby boomers to their Gen X and Millennial children between 2023 and 2026.

That's an astronomical amount of money. A "trillion-dollar tsunami," as Keith Willoughby from the Edwards School of Business at the University of Saskatchewan calls it. It's reshaping the Canadian economy, particularly real estate markets. And it's fundamentally changing who can afford to buy homes.

But here's what most coverage of this wealth transfer misses. This isn't redistribution. It's preservation. Wealth isn't spreading across society. It's staying exactly where it's always been, concentrated among families who already have it.

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The Numbers Are Staggering

Much of that $1 trillion is tied to real estate. Baby boomers bought homes in the 1970s, 1980s, and 1990s when prices were a fraction of today's values. They rode decades of appreciation that turned $200,000 homes into $1 million-plus assets.

According to CIBC, 31% of first-time homebuyers in Canada in 2024 received financial help from family members to buy a home. That percentage is even higher in Toronto and Vancouver, where home values have risen most dramatically.

Statistics Canada found that for people born in the 1990s, those whose parents were homeowners were twice as likely to become homeowners themselves compared to those whose parents didn't own property.

That's not meritocracy. That's inherited privilege compounding across generations.

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Women Are Inheriting, But Not Gaining Power

Some media coverage celebrates the idea that women are about to control more wealth than ever before. But this trend is demographic, not revolutionary.

As wealthy men pass away, their estates are often transferred to their spouses. Women statistically outlive men by four to six years. During that time, many women will have temporary control over large sums of money.

But this doesn't represent systemic change. It simply postpones the transfer of wealth to younger generations. In short order, that wealth will be distributed among children and grandchildren, often maintaining the same patterns of privilege that existed before.

And many women are surprised by inheritances, suggesting they weren't involved in estate planning or financial decision-making during their family member's lifetime. Control without agency isn't economic power.

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The Tax System Rewards Wealth

When someone dies, Canadian tax law treats their assets as if they were sold and immediately repurchased by their estate at fair market value. This "deemed disposition" typically triggers capital gains taxes.

But capital gains are taxed differently from employment income. While you pay tax on 100% of your earnings from employment, only 50% of a capital gain is taxable.

Imagine inheriting your parents' investment portfolio. If they bought $260,000 worth of shares in 1990 and they're now worth $1.26 million, that's a $1 million gain. Only $500,000 would be included in taxable income. The other $500,000 passes to you tax-free.

Real estate gets even better treatment. Thanks to the principal residence exemption, the $1 million increase in your parents' home value is 100% tax-free. Not a single dollar of that gain contributes to public revenue.

Canada has not had an inheritance tax since 1972. These redistribution efforts remain entirely optional.

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The Principal Residence Exemption Perpetuates Inequality

The principal residence exemption has been in place since capital gains taxes were introduced in 1972. The stated purpose is to help Canadians build wealth by supporting homeownership.

But homeownership is declining. A third of Canadians are renters. There's no analogous tax credit or policy that benefits renters, even though they're paying the same market rates for housing without building equity.

Policies like the PRE protect and perpetuate wealth among those who already have it, while limiting the government's ability to invest in public systems that benefit everyone. Healthcare, childcare, affordable housing, education. All underfunded while billions in real estate gains pass tax-free between generations.

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When the Trudeau Government Tried to Change It

When the Trudeau government proposed increasing the capital gains inclusion rate by 16.7%, it could have generated meaningful revenue and nudged the tax system toward greater fairness, especially for Canadians who aren't in line for a windfall inheritance.

The backlash was immediate. The proposal was quietly dropped when Mark Carney became prime minister in early 2025, another sign of how resistant Canada's political class remains to even modest redistribution.

The result is predictable. A wealth transfer that reinforces the existing hierarchy rather than redistributing opportunity.

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The Bank of Mom and Dad Is Now the Market

According to Statistics Canada, one in six homes across Canada owned by people born in the 1990s is co-owned with their parents. That's not a small percentage. That's a fundamental shift in how homeownership happens.

The Bank of Mom and Dad isn't just helping with down payments anymore. Parents are co-signing mortgages, buying properties outright and letting kids live in them, or financing laneway houses and intergenerational living arrangements.

Writer Katrina Onstad describes this as "status fog." A growing disconnect between perceived income and lifestyle, where inherited wealth obscures a person's true financial standing and distorts our understanding of what constitutes a middle-class lifestyle.

Some people achieve homeownership not through their own earnings but through inherited wealth. That creates an uneven playing field where your parents' net worth matters more than your income, education, or work ethic.

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Indigenous Communities Are Excluded Entirely

Jason Bird, a business professor at First Nations University of Canada, points out that many Indigenous communities lack a "boomer generation" in the same way as the broader Canadian population.

Historical factors and exclusion from the wider economy mean there's less accumulated wealth to transfer. This exacerbates existing economic disparities.

"We don't even have really a boomer generation to pass stuff down," Bird said. "Most of the people from that generation, numerous of them have passed on already. They're already gone, but there was never a real inclusion in the wider economy so there wasn't much to leave."

Bird also highlights that wealth is often viewed differently in Indigenous communities, with an emphasis on sharing and communal wellbeing rather than individual accumulation. "Wealth is kind of judged differently in Indigenous communities. Really, the ability to share more is actually considered wealth. The more you have, the more you can give."

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What Real Economic Transformation Would Look Like

If Canada truly wanted to advance economic equity, four policy shifts would create genuine systemic change.

First, pay equity. Value a unit of women's labour as equal to that of men. The Pay Equity Act was passed in 2018 and came into force in 2021, covering federally regulated workplaces with more than ten employees. But provincial coverage varies widely.

Second, universal parental financial support. Decouple maternity and parental benefits from Employment Insurance. Childcare and postnatal care are work, not unemployment. Financial benefits should be distributed on a per-child basis and calculated based on the actual costs of supporting a baby, a caregiver, and a stable home environment.

Third, support for the self-employed. Ten percent of the labour force is self-employed. That includes more than one million women in Canada. Yet government policies and programs overwhelmingly cater to employers and employees. Developing robust supports for self-employed workers would improve economic outcomes for women and strengthen the broader economy.

Fourth, tax reform. An increase in the capital gains inclusion rate, paired with an annual and indexed lifetime exemption threshold, would allow for greater tax fairness. Alternatively, the capital gains inclusion rate could be applied on a sliding scale depending on the total gain amount, resulting in higher inclusion rates for higher value gains.

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The Longer Boomers Live, The Less Gets Transferred

Here's a complication nobody talks about enough. Boomers are living longer than expected, and the costs of aging are substantial.

Mallory McGrath, CEO at Viive Planning, points out that members of the Silent Generation, born 1928 to 1945, are now living into their late 80s and early 90s. Because they didn't expect that life expectancy, many haven't planned for the associated costs, including chronic disease management and long-term care.

"A lot of times, those good intentions are squashed by the fact that they live a lot longer than they think they're going to," McGrath says.

Healthcare costs in the final years of life can be enormous. Long-term care facilities cost $5,000 to $10,000 per month. Home care, medications, and assisted living all drain savings. Some boomers who planned to leave substantial inheritances will instead spend most of their wealth on their own care.

That means the wealth transfer might not be as large as projected. And for families counting on inheritances to achieve financial security or homeownership, those plans could be disrupted by parents simply living longer than expected.

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How This Affects Real Estate Markets

The wealth transfer is already reshaping real estate markets in visible ways. In cities like Toronto and Vancouver, young professionals who should be priced out are buying million-dollar homes. How? Family money.

According to Ipsos, among Canadian boomers planning to leave 100% of their estates to their children, the average inheritance will be about $450,000. In high-cost markets, that's a down payment.

This creates a two-tier market. People with family wealth can buy. People without family wealth can't, regardless of their income, education, or career prospects. The market isn't rewarding productivity anymore. It's rewarding lineage.

For sellers, this matters too. Buyers with family backing can offer higher prices, compete more aggressively, and close more quickly. That puts upward pressure on prices, which makes the market even less accessible for buyers without family support.

The result is a housing market increasingly determined by intergenerational wealth transfer rather than by wages, employment, or individual savings.

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How Coldwell Banker Horizon Realty Can Help

At Coldwell Banker Horizon Realty, we understand that family wealth dynamics affect real estate decisions in complex ways. Whether you're receiving financial support from family to buy your first home, planning to help adult children enter the market, or navigating estate planning to ensure your real estate assets transfer efficiently, we provide the expertise and guidance you need.

Intergenerational wealth transfer creates opportunities for some buyers while fundamentally changing market dynamics. Understanding how these trends affect your local market requires professional insight and experience.

Contact Coldwell Banker Horizon Realty today to discuss how intergenerational wealth transfer is shaping real estate in your area and how we can help you navigate these changing dynamics, whether you're buying, selling, or planning for the future.

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The Bottom Line

Canada's $1 trillion wealth transfer is real, and it's happening now. But it's not transforming the economy or redistributing opportunity. It's preserving wealth within families that already have it.

People whose parents own homes are twice as likely to become homeowners themselves. One in three first-time buyers receives family help. One in six homes owned by people born in the 1990s is co-owned with parents.

The tax system reinforces this inequality. Capital gains are taxed at half the rate of employment income. Principal residence gains are entirely tax-free. Canada hasn't had an inheritance tax since 1972.

For real estate markets, this means buyers with family wealth outcompete buyers without it, regardless of income or career prospects. The market rewards lineage more than productivity.

And for Canadian society, it means wealth concentration is deepening, not easing. One percent of Canadians control roughly a quarter of the country's total wealth. The trillion-dollar transfer won't change that. It will make it worse.

Unless policy changes address the structural factors that perpetuate inequality, the great wealth transfer will simply be the great wealth preservation. Money changing hands within the same families, while everyone else watches from the outside.