Face it, the COVID-19 pandemic made Ontario's housing market stupidly unaffordable. As a result, home prices skyrocketed across the province, and smaller regions near big cities became record-breaking hot spots.
But, thankfully, for first-time home buyers living in those areas, what goes up, must come down.
"We expect the housing market correction in Ontario to be led by a decline in sales activity and prices in smaller centres outside of major urban areas," the report reads. "We think prices will fall the most in communities that saw the biggest price increases during the pandemic and therefore the most erosion in affordability."
The financial services company argues that as life returns to normal in the province, smaller communities will be unable to maintain their unprecedented pandemic price gains as people return to in-person work.
As a result, hot spots areas, all within a few hours' drive of Ontario's least affordable city, Toronto, are likely to see prices cool off the fastest as borrowing costs rise and commuting returns adds.
Out of those regions, Bancroft, a small town located 3 hours outside of the 6ix, will see the most significant decline in 2023, with Chatham Kent and Windsor-Essex also set to see a sizeable drop, followed by Tillsonburg and Woodstock-Ingersoll.
However, none of these regions are set to reach pre-COVID prices, with the report citing international migration and hybrid work arrangements as the most prominent factors.