Both Windsor-Essex and Chatham-Kent are among cities expected to see a steep decline in housing prices over the next 18 months.
A new report by Desjardins describes how Canada's housing market is at an inflection point. After two years of skyrocketing prices, increased borrowing costs are cooling the market, most notably in cities that saw the sharpest increases during the pandemic.
However, the report says sellers will likely lose a sleeve but not their shirt. It predicts a correction in housing prices, not a collapse. The report's authors believe the average national home price will fall by 15 per cent by December 2023, still above pre-pandemic levels.
As lockdowns took effect, more people in large cities like Toronto started looking for more spacious homes they could afford on the outskirts and beyond. They found those homes in Hamilton, London, and Barrie.
Bancroft saw the sharpest average increase at 185 per cent above December 2019. However, prices shot up as far away as Chatham-Kent and Windsor-Essex.
As a result, the report suggests the biggest declines in the next year and a half will be in Bancroft, Chatham-Kent, Windsor-Essex, Tillsonburg and Woodstock-Ingersoll.
The report concludes the housing market correction has already begun, and local data appears to bear that out.
The Windsor Essex County Association of Realtors reported a drop in prices for the third consecutive month in May, while the Chatham-Kent Realtors Association foresees a decline over the next few months.
