Older millennials, adults aged 35 to 44, had debt-to-disposable income ratios around 250 per cent in 2019, while Freestone noted that metric was roughly 150 per cent for the same age group in 1999.
Can confirm we’re sitting around 250% but this is after exercising significant restraint to not take on as much mortgage as the banks would have given us. Everyone I know who bought over the last couple of years went all out and I can’t imagine them being any lower than 300-350%.
In what way is it is essential for the vast majority of the population? Rural dwellers, perhaps (although Canada’s Old Order Mennonite/Amish population seem to manage just fine), or those with particular disabilities, but most people?
I live in a small town and could easily go without a car. Imagine those who live in cities, which is the majority of Canadians. The whole reason they are wanting to jam themselves together so tightly is exactly so that they don’t need vehicular transportation to live life!
I do own a car, though, as the ROI on my vehicle easily exceeds 10%. I don’t like owning a car, but where else am I going to find those kind of returns?
It wouldn’t be that way if it weren’t a good investment, but it generally is (becoming much less so over the past couple of years, granted) for a lot of people. In part because of subsidies, of course, but I expect that it would still provide good ROI even if the subsidies were lifted. The early road infrastructure in Canada was built by private interests, after all.
Being capital, it is a useful tool that gets useful things done. When useful things get done, life improves for all of us. What else are you going to invest in with similar affordability, risk, and returns? In other words, which tools would most people find more useful than a car to get useful things done?