Years of low interest rates and easy credit pushed Canadian home prices past what young incomes could carry, and a widening wealth gap has done the rest. That is why, as of the May 2026 Statistics Canada report, about one in six Canadians aged 25 to 39 still lived with their parents, and about one in four in Toronto.
I am Moe Asgarian, a real estate broker in Toronto, and this number explains more of my business than any price chart does. Three reports landed close together in the spring of 2026: one on young Canadians living at home, one on the wealth gap, and one on the Greater Toronto rental market. Read together, they describe the same squeeze from three angles.
The Statistics Canada numbers on young Canadians living at home
As of the May 2026 Statistics Canada report, about one in six Canadian millennials, people between 25 and 39, were still living with their parents. In the early 1990s roughly 8% of that age group lived with family. By the time of the May 2026 report the share had passed 16%, roughly double the boomer generation. Over a few decades, the ability of a young Canadian to become independent has clearly weakened. The report points directly at the housing crisis and at credit conditions: years of low interest rates and easy borrowing kept pushing prices up, and instead of the market correcting, a large housing bubble formed. The same report shows that the number of young people living with a partner or a child had fallen sharply by 2026. Many have delayed forming a family because they cannot afford it. The issue is not only buying a home, it is that a whole cohort has not been able to move into the next stage of life.
Toronto is worse than the national average
In the May 2026 Statistics Canada report, about 26% of Toronto residents aged 25 to 39 still lived with family, more than one in four. In that same report, close to half of Torontonians under 30 had no independent home of their own. This is not only a Toronto and Vancouver problem either. As of May 2026, cities that used to be the affordable alternative, Calgary, Montreal, Winnipeg and Halifax, had all seen the share of young adults living with family climb sharply. Canada has always been attractive to immigrant families because parents believed their children would have a better future here. Many of those children still cannot buy a home or build an independent life.
The wealth gap widened through 2025
The second report is about net worth, and it is blunt. At the end of 2025 the average net worth of a Canadian family was about $1,080,000, and most of that growth came from the stock market rather than from housing. Wealthier households moved money into equities and financial assets and were paid for it. Lower income households mostly borrowed, largely for a mortgage. At the end of 2025 the wealthiest 20% of Canadians averaged about $3.5 million in net worth, and over the year to the end of 2025 each added more than $200,000 on average. Over that same year the bottom 40% gained about $1,700, roughly 120 times less. The mortgage split over 2025 is just as clear: the wealthiest slowed their borrowing, with mortgage debt up about 0.7%, while the bottom 40% saw mortgage debt grow about 7.5%. At the end of 2025 the top 20% held about 66% of the country's total wealth, the bottom 40% held about 3%, and the bottom 20% had negative net worth, meaning they owed more than they owned.
Why lower interest rates do not automatically help
One point in that report deserves more attention than it gets. Statistics Canada says falling interest rates can widen the wealth gap rather than close it. When borrowing gets cheap, wealthy households borrow easily and make larger investments. Lower income households mostly borrow more for necessities, housing above all. A study by the Dutch central bank covering 95 years of data across 15 countries found that falling interest rates can shift somewhere between 1% and 6% of national wealth toward the wealthiest. Cheap money does not necessarily make a house easier to buy, which is worth remembering the next time a rate cut is announced as good news for first time buyers.
Greater Toronto's rental market turned toward tenants
The third report, published by Urbanation in the spring of 2026, says the Greater Toronto and Hamilton rental market entered a different phase. In that spring 2026 report, about 5.4% of rental units were sitting empty, roughly one in 19, the highest vacancy rate since the pandemic lockdowns. The more telling number in the same report is the share of units that are either empty or whose tenant has given notice, which reached 8%, roughly one in 12. Asking rents had not dropped much on paper by the spring of 2026, but landlords and new projects were handing out incentives, and about 66% of rental projects were offering them at that time. The most common is two months of free rent, alongside cash bonuses and discounts. In the spring of 2026 the average asking rent was around $2,900, but after incentives the effective rent came to about $2,500, an effective cut of roughly 13%. Landlords prefer to keep the posted rent high, because a lower official rent can lower the appraised value of the building. Meanwhile, in the year to that spring 2026 report, construction started on more than 10,000 new rental units, close to 9,000 units were due within the 12 months after it, and condo investors were adding supply on top. The familiar story of a severe rental shortage, at least in the short term, is no longer what it was, especially with young people leaving Toronto for other provinces.
What I tell young buyers in Toronto
Here is what I say to the young people who sit across from me. Living at home is not a personal failure, it is arithmetic, and in the spring of 2026 that arithmetic was unusually forgiving for anyone with patience. Renters had leverage they had not had in years, so a family could stay put, negotiate free months on a lease, and keep saving instead of buying in a panic. Buyers were no longer facing a crowd of competing offers on everything. The trap to avoid is assuming a rate cut is on your side. Cheap borrowing lifts the price of the asset you are trying to buy, and the wealth data shows exactly who captures that gain. What moves you forward is a bigger down payment and a purchase you can still carry if your income pauses.
If you are saving toward a first home in Toronto or the GTA and want a plan that fits your own numbers, fill out the form at the bottom of this page or book a free consultation. Stay well and take care.
Frequently asked questions
How many Canadian millennials live with their parents?
According to the Statistics Canada report discussed in May 2026, roughly one in six Canadians aged 25 to 39 still lived with their parents, more than 16%. In the early 1990s about 8% of that age group did, so the share had roughly doubled in a few decades.
Is the problem worse in Toronto than in the rest of Canada?
Yes. In the May 2026 Statistics Canada report, about 26% of Toronto residents aged 25 to 39 lived with family, more than one in four, and close to half of Torontonians under 30 had no independent home. Calgary, Montreal, Winnipeg and Halifax had also seen sharp increases by that point, so it is not only a Toronto and Vancouver problem.
Do lower interest rates make housing more affordable?
Not automatically. Statistics Canada noted in its May 2026 report that falling rates can widen the wealth gap, because wealthier households borrow cheaply and invest while lower income households borrow more for necessities. A Dutch central bank study of 95 years of data across 15 countries found that falling rates can shift between 1% and 6% of national wealth toward the wealthiest.