Oro Station Motor Circuit revs up construction
Construction is revving up at Oro Station Motor Circuit in Oro Medonte Ont., on May 26, 2025. (CTV News/ Luke Simard)
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Globe and Mail
9 minutes ago
- Globe and Mail
Why an increase in mortgage-free young people is a worrisome sign
'Generation Z is unprecedentedly rich.' That was the bold headline of a recent Economist article, drawing on international data showing many young adults today financially outpace boomers when they were the same age. Since I often report the opposite for younger Canadians, the claim gave me pause. So, I revisited national data on income, unemployment and home ownership for those aged 20 to 34. Canada tells a different story from the Economist headline, except for one notable trend: home ownership among young adults surged during the pandemic. This raises a deeper concern. Canada may be drifting from a meritocracy (albeit an imperfect, and often tilted toward white men, meritocracy) toward a landed aristocracy, where access to secure housing increasingly depends on being born into the right family. The concern doesn't show up in income data. In 1976, when most boomers were young adults, the median full-time, full-year earnings for 20- to 24-year-olds was $43,800 in today's dollars, according to Statistics Canada. The contemporary figure is slightly lower at $41,400. For 25- to 34-year-olds, median earnings dipped from $64,400 in 1976 to $62,500 today. But things shift when we turn to housing. I combined data from Statistics Canada's surveys of consumer finance and financial security, along with five-year mortgage interest rates with average price data from the Canadian Real Estate Association. The result is telling. In 1977, 41 per cent of Canadians under 35 owned a home. The average house cost $253,000 (in today's dollars), it took five years of full-time work to save a 20-per-cent down payment and mortgage rates averaged 10.75 per cent. By 2019, home ownership for young Canadians had dropped to 36 per cent. The average home (now more often a condo) cost $598,000, and it took 13 years to save the down payment. Lower interest rates around 4.6 per cent made carrying a larger mortgage more manageable. Then came the pandemic. As emergency-level interest rates fell to around 3 per cent for 5-year fixed mortgages, home prices soared to $789,000 in 2021 before easing to $700,000 in 2023. Despite the sharp rise in costs – and the 14 years now needed to save a 20-per-cent down payment – home ownership among Canadians under age 35 jumped to 44 per cent, the highest level in five decades. That surge is striking when compared to older peers, whose home-ownership rates remain below historical norms. Among 35- to 44-year-olds today, just 63 per cent own a home – 10 points lower than the same age group in 1977. One clue behind the surge in home ownership among Canadians under 35 stands out: in 2023, 18 per cent of young homeowners reported having no mortgage. The only time this figure was higher was in 1984 – when home values were a third of today's, and interest rates were three times as high. Since 1977, the net value of Canadian principal residences – the total worth of homes minus outstanding mortgages – has grown by $1.5-trillion, after adjusting for population, economic growth and inflation. Canadians over 55, who represent just 30 per cent of the population, captured 60 per cent of that windfall. During the pandemic, record-low interest rates allowed many older homeowners to liquify their housing wealth through refinancing. The data – particularly the number of mortgage-free young people - suggest some may have used that wealth to help younger family members enter the market. At the family level, it's a beautiful act of intergenerational love. At the societal level, it's deeply troubling. Because entering the housing market increasingly depends on how much housing wealth your family has accumulated – not how hard you work. That's the textbook definition of a landed aristocracy. This trend is already driving a sharp divide among younger Canadians. The median net worth of homeowners under 35 is $457,000. For their peers who rent, it's just $44,000. In my last column, I called for a national task force to confront a question too many politicians dodge: should home prices rise, stall or fall? That same task force should also take up a related challenge – how to address the growing housing wealth divide between generations, and now increasingly within them. If we believe Canada should reward effort over inheritance, then we must face a hard truth: our housing system is failing the meritocracy test.
CTV News
30 minutes ago
- CTV News
Activist investor Engine Capital plans to vote against US$9.1B Parkland-Sunoco deal
A Pioneer gas station is shown in Carleton Place, Ont., on Saturday, Nov. 8, 2008. THE CANADIAN PRESS/Sean Kilpatrick CALGARY — A major shareholder in fuel refiner and retailer Parkland Corp. says it plans to vote against its planned takeover by U.S. heavyweight Sunoco LP. Engine Capital owns 2.5 per cent of Parkland's shares, making it one of the Calgary-based company's biggest investors. In a letter to Parkland's board of directors, Engine's leadership argues the Sunoco deal was rushed, the price is too low and that there are likely better options available. A month ago, Parkland and Sunoco announced a friendly cash-and-stock takeover deal valued at US$9.1 billion including debt Shareholders are to vote on the transaction at a meeting set for June 24 in Calgary. Engine says it has nothing against Sunoco and would happy to become a long-term investor in that company — but only if its offer is rejigged to better reflect Parkland's value. This report by The Canadian Press was first published June 6, 2025. Lauren Krugel, The Canadian Press
CTV News
30 minutes ago
- CTV News
Energy and tech stocks help lift S&P/TSX composite
The Toronto Stock Exchange Broadcast Centre is shown in Toronto on Friday June 28, 2013. THE CANADIAN PRESS/Aaron Vincent Elkaim TORONTO — Canada's main stock index was up in late-morning trading, helped by strength in energy and technology sectors, while U.S. stock markets also climbed higher. The S&P/TSX composite index was up 81.84 points at 26,424.13. In New York, the Dow Jones industrial average was up 353.70 points at 42,673.44. The S&P 500 index was up 53.32 points at 5,992.62, while the Nasdaq composite was up 198.88 points at 19,497.33. The Canadian dollar traded for 73.04 cents US compared with 73.21 cents US on Thursday. The July crude oil contract was up US$1.10 at US$64.47 per barrel and the July natural gas contract was up two cents US at US$3.70 per mmBTU. The August gold contract was down US$23.10 at US$3,352.00 an ounce and the July copper contract was down five cents US at US$4.88 a pound. This report by The Canadian Press was first published June 6, 2025.
