Environics Analytics’ WealthScapes and WealthTrends Explore the Financial Well-Being of Canadian Households

Data Suggests Canadians’ Financial Position is Solid Despite the COVID-19 Pandemic

Toronto, Ontario, CANADA

TORONTO, Nov. 10, 2020 (GLOBE NEWSWIRE) -- Canadians entered the new decade in sound financial shape after experiencing steady gains in the equity market and an increase in average household net worth in 2019. Despite the challenging economic conditions in early 2020 as a result of the COVID-19 pandemic, Canadians’ net worth hit all-time highs by mid-year.

New analysis by Environics Analytics using WealthScapes 2020, the company’s authoritative financial database that breaks down assets, liabilities and incomes of Canadians at the neighbourhood level, found that the average Canadian household net worth rose by $38,998 or 5.6 percent to $733,154 in 2019. During the same period, the equity market rebounded from a tough at the end of 2018 with consistent growth throughout 2019, contributing to an increase in liquid assets of $26,152 or 9.1 percent. Modest growth in national real estate values resulted in an increase of $4,835 or 1.2%, while consumer debt levels remained largely unchanged, only increasing by $756.17 or 1.8 percent in 2019. 

“We observed solid Canadian household net worth growth in 2019,” states Peter Miron, SVP of Research and Development at Environics Analytics. “Unlike prior years, this past year’s growth was not principally due to real estate appreciation. Quebec and Prince Edward Island had very strong net worth growth with Ontario following shortly behind, primarily from the performance seen in Southwestern Ontario.”

This financial snapshot emerged from data in WealthScapes 2020, now in its 13th year, documenting the financial well-being of Canadian households. The database provides insight on all aspects of household finances, including real estate, employer pension plans, tax-free savings accounts and credit card debt. This research demonstrates that Canadian household balance sheets were in good shape entering into the new year.

Additional analysis by Environics Analytics, using WealthTrends, a newly released financial recovery product designed to provide quarterly economic and financial status updates, found that the significant decline of the equity market in Q1 of 2020 resulted in Canadian investments dropping by an average of $31,801 or 15.4 percent as the COVID-19 pandemic hit. With lingering uncertainties surrounding the equity market and increase in remote work, real estate investments have emerged as an appealing option for Canadians. By the end of Q2 this year, the average real estate value per Canadian household rose by $17,499.15 or 4.3% since December 31st of 2019.

“While the pandemic has upended the lives of the Canadians, the same is not necessarily true of household net worth,” says Karin Martin, Vice President of Data Development at Environics Analytics, who was closely involved with the development of WealthTrends. “With some variation across the country, the net worth declines at the start of 2020 had largely recovered by the end of the second quarter with net worth now at an all-time high. Ontario and Quebec (and Toronto and Montreal in particular) have seen strong net worth growth due to high savings rates, a frothing real estate market and prudent management of household debt.”

Throughout Q2 of 2020, many Canadians have continued to favour holding money in term and demand deposits to pay off high-interest debt rather than investing in additional equity products. Meanwhile, the average Canadian’s savings have increased by $8,600 or 8.1 percent, while credit card debt has decreased by $1,060, or 15.7 percent since the beginning of the year.

Atlantic provinces experienced the highest rise in net worth with an average of 9.9 percent increase in liquid assets and average pension values grew by 8.7 percent, which can largely be attributed to increased savings rates and the rebound of the equity market. Of the major Canadian cities, Montreal and Ottawa saw the highest levels of growth in 2019, due mainly to their increases in the average household net worth of 8.6 percent and 8.3 percent respectively, primarily attributed to thriving real estate markets in both CMAs. 

Environics Analytics created WealthScapes and WealthTrends to help financial institutions, retailers, charities and other organizations analyze the financial profile of current and potential customers, identify promising markets and develop business strategies. WealthScapes and WealthTrends are built using sophisticated modelling techniques and aggregated, privacy-compliant, small-area data from a variety of authoritative sources, such as the Bank of Canada, Equifax, Statistics Canada and the Teranet-National Bank House Price Index™.

For additional information on WealthScapes, please visit: https://environicsanalytics.com/en-ca/data/financial-databases/wealthscapes

For more information on other products and services from Environics Analytics please visit www.environicsanalytics.com

About Environics Analytics
Environics Analytics (EA) is the premier marketing and analytical services company in North America, helping thousands of customers across every industry sector turn data and analytics into strategy, insights and results. Established in 2003, we specialize in using best-in-class data, analytics expertise and purpose-built software to address key challenges in areas such as consumer profiling and segmentation, multichannel media planning and execution, trade area analysis, merchandising strategies and site location decision-making. Our ENVISION platform provides quick and easy access to our comprehensive and privacy-compliant databases—including the latest mobile movement data—to generate deep consumer and market insight, authoritative reports and detailed maps. Environics Analytics' team of statisticians, modellers, geographers and business strategists help organizations develop data-driven solutions and achieve success along every phase of their analytics journey. Learn more at www.environicsanalytics.com

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