Key findings:
- Real estate remains a core wealth-builder for high-net-worth Canadian families.
- Integrating real estate into a holistic wealth strategy unlocks more value and can help ensure property complements financial goals.
- Real estate assets may offer diversification, stability and a potential hedge against inflation.
- Structures like trusts can enhance tax efficiency, privacy and estate planning.
- Private bankers help affluent Canadians navigate property financing, risks and cross‑border rules.
- With thoughtful planning, property becomes a long‑term generational asset.
Real estate is a favoured asset among Canadians.
For some, that goes beyond a principal residence or even the cherished family cottage. Affluent individuals and families often acquire multiple properties for investment and business needs, recognizing they are critical parts of long-term wealth strategies.
“Real estate has always been viewed as an alternative or a complement to traditional portfolios to build long-term wealth, offering greater diversification and stability,” says Patrick Sum, vice president of Lending, and deputy head of Credit at RBC Private Banking.
He adds that real estate valuations have traditionally shown low correlations to stocks. “It may offer a good hedge against inflation.”
As interest rates have fallen, Mr. Sum says the appeal for investing in residential or commercial properties has risen. But adding property to an already sophisticated portfolio introduces layers of financial, tax, legal and structural considerations—and missteps can have major implications.
“Decisions around real estate investing shouldn’t be made in isolation,” says Gloria DiGiovanni, managing director, RBC Private Banking.
Viewing and co-ordinating these investments in the context of a family’s total wealth picture, she explains, helps ensure “real estate complements rather than conflicts with long-term planning.”
How private banking integrates real estate into broader financial plans
Private bankers work to deeply understand the overall financial needs and goals of their clients, and can help them realize the full potential of real estate as part of their bigger wealth blueprint. These specialists can also provide advice when clients are acquiring assets outside of Canada, which can involve different and complex taxation rules.
When real estate investments are integrated into broader plans, they can serve as foundations to build even more wealth. That includes enabling clients to borrow against existing properties to capitalize on additional real estate and other investment opportunities.
Given most real estate investments involve leverage, one of the biggest considerations is a client’s risk appetite, Mr. Sum says. “What’s your ability to weather a financial storm, such as periods where a property may be vacant and not generating rental income?”
Many private banking clients have the financial wherewithal to manage these risks. Yet no one investment is alike, requiring bespoke planning to meet each family’s needs.
How high-net-worth families use real estate for tax-efficient estate planning
Many high-net-worth clients consider tax-favourable structures that also address estate and legacy goals, Ms. DiGiovanni says.
Trusts are commonly used by private banking clients at RBC to hold real estate assets. “If a client has a long-term, generational plan, a trust may offer important benefits,” she explains. That includes carrying out wealth transfers while maintaining privacy, unlike a sole ownership where it’s more public.
Other clients look to their family businesses to hold investment properties, affording other tax and wealth-building advantages. “The right structure really depends on each client’s needs,” Ms. DiGiovanni says.
RBC Private Banking offers market insights, as well as holistic analysis and planning, to help determine the most favourable financing strategy. “You’ve got access to very sophisticated credit solutions that are not available through the more conventional banking channels,” Ms. DiGiovanni points out.
When real estate is more than a place to live or vacation, but a strategic asset class, it can support long‑term growth, generate income and create opportunities to build wealth for future generations. The right expertise and guidance can solidify those goals and help clients test scenarios.
“Market conditions matter, but long-term wealth goals should drive decisions more than timing,” Ms. DiGiovanni says. “That’s why a relationship-driven, private banking team is so beneficial to the families we work with. We’re here for them before the transaction and afterward, ensuring they reach their intended goals today and for the long haul.”
Real estate can be more than an investment; it’s a strategic tool to help build and preserve wealth across generations. Visit RBC Private Banking to explore how private bankers help high-net-worth families include property in their wealth strategy.
This article was originally published in The Globe and Mail .
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