As reported by BNN
’s Greg Bonnell, the latest study by CIBC deputy chief economist Benjamin Tal noted that around $750 billion in assets will be passed down to Canadians between the ages of 50 to 75 over the next 10 years.
“[More] Canadians over the age of 75 will pass away in the coming decade,” Tal wrote in his report “The Looming Bequest Boom – What Should We Expect?”
“We have a lack of supply,” Tal added in a Monday (June 6) interview with BNN. “One of the reasons is that most of those low-rise are being occupied by those people who are relatively older.”
The departure of the over-75 segment from these homes in the next few years “might modestly ease the shortage” of supply, Tal argued in his study.
Combined with the fact that majority of those in the 50-75 age range are already secure in their finances and properties, Tal hypothesized that it is the millennials instead who would benefit the most from the billions in assets that the aged currently hold.
Tal advised industry players to remain vigilant, however, as any stability in the markets stemming from this upcoming boom would only be temporary.
“[The] inheritance wave will not solve the problem, but it’s a step in the right direction,” Tal stated. “It will not change the system, but it will ease the pain.”
In as little as a decade, the wealth of arguably the richest generation in Canadian history will be transferred down to their successors, possibly ushering in a period of relative relief for the country’s extremely overheated real estate sector.