outlines three possible outcomes for the future of the city’s housing market, including the worst-case scenario, which looks at a “1990s-style Ontario recession” that would drive average home values down by 16 per cent by the end of next year and 30 per cent by the end of 2025.
“Even if that improbable outcome were to materialize within the next three years, it would only bring Toronto’s home price to per capita disposable income ratio back to still stretched, late 2015 levels,” the report notes. “Such a significant price decline could likely only come at a massive economic and social cost. Compared to our base case Ontario forecast, a 1990s style recession would result in a more than $35B reduction in employment income and almost half a million total job losses by Q4 2025,” the report reads.
In the most likely scenario, Toronto house prices would hit bottom by the end of 2024, reaching about five per cent below July 2023 levels.