A recent poll conducted by Generation Squeeze and Research Co. tried to get a sense of how Canadians would answer the age-old question: What makes you wealthy and what makes you poor?
Or more specifically, how much makes you wealthy and how little makes you poor?
The poll, conducted in February 2022 among approximately 1,000 Canadians, with results being released in increments this month, consists of questions that frame being wealthy as not just one's income, but also their housing status.
The questions were centered on two hypothetical people: a 35-year-old that earns $250,000 a year and a 65-year-old retiree with a fixed annual pension income of $22,000. The questions then changed details about each person's housing status, to get an idea of how perceptions of those people's wealth change in response.
When described as renting a home, a majority of respondents (63%) considered the 35-year-old earning $250,000 as "very or moderately wealthy." When given a home worth $1 million that's fully paid off, however, that number rises to 83%. If the house isn't paid off, to the tune of having $900,000 owing on the mortgage, then the number drops by over half, to 41%, still the highest response rate, but more evenly split with "neither wealthy nor poor", at 39%.
Meanwhile, when the 65-year-old retiree is described as renting a home, 63% of respondents considered them to be "very or moderately poor", an identical amount as those considering a $250,000 earner and renter as "very or moderately wealthy." When given a fully-paid $1 million home, about half of respondents (47%) viewed the retiree as "very or moderately wealthy." With a fully-paid home worth $2 million, that number rose to 58%.
In a blog post about the poll results, Generation Squeeze -- a BC-based non-profit that focuses on a variety of issues that disproportionately affects younger generations -- summarized the results. "All in all, survey data confirm that owning a home is an important marker of wealth in Canada. Many Canadians believe that home ownership grows one’s wealth, even if a home is not owned outright."
A different section of the poll presented respondents with a statement -- "Rising real estate prices benefit many people who already own a home by growing their wealth" -- and asked them how strongly they agreed with it. The respondents also self-identified themselves based on the value of their primary residence, to gauge and control for how respondents' home values affected their responses. Their responses to the statement were clear; regardless of whether or not a respondent's home was valued between $250,000 to $500,000, $500,000 to $750,000, $750,000 to $1 million, or more than $1 million, 42% to 47% said they "moderately agree" with the statement.
"The fact that a majority of Canadians recognize that rising home prices bestow financial benefits on home owners suggests that our understanding of wealth isn’t just about the income one earns. Housing status matters too", Generation Squeeze added.
In related news, Canadian millennials reportedly remain optimistic about homeownership despite the recent ups and downs of the national housing market.