Source: The Financial Post
Garry Marr | May 25, 2015 | Last Updated: May 25 1:54 PM ET
Real estate is making everyone richer on paper, including those already wealthy.
A survey released Monday from Bank of Montreal of its high net worth clients, those who have more than $1 million in investible assets, finds their primary residences in Canada are worth almost $1.5 million on average.
These people like their real estate – 36 per cent own a second property with an average value of $708,539. In the group that owns a second property, 40 per cent own two or more properties.
Across the country, B.C. high net worth homeowners have the most value in their primary residency at an average $3.9 million. Those people carry $236,100 in debt, according to the survey.
Indeed, most wealthy Canadians surveyed are free and clear of their mortgage and even among those with debt, the average amount they have outstanding is $176,000.
“It’s encouraging to see that so many affluent Canadians are making it a priority to be mortgage free, a significant financial milestone for any home owner,” said Craig Downey, vice-president and managing director of platinum banking with BMO Private Banking, in a statement.
It’s encouraging to see that so many affluent Canadians are making it a priority to be mortgage free
On the second property front, 80 per cent of respondents who have one, say it is in Canada. Another 27 per cent have property in U.S., 11 per cent in Europe, eight per cent in Central America, South America or the Caribbean, seven per cent in either Mexico or Asia and five per cent in Australia.
Vacation purposes were cited by 47 per cent of respondents with second properties as the number one reason for owning. The second reason for owning was for investment purposes at 39 per cent, followed by income-generating property at 36 per cent.