Owning a house in or around Toronto is no cheap prospect, as home prices in the region soared to all-time highs in 2022. But it looks like homebuyers are getting a break from the intense and sustained price appreciation in the GTA as markets cool in the wake of the Bank of Canada hiking interest rates.

RE/MAX Canada released its 2022 Hot Pocket Communities Report on Thursday morning, comparing market activity from 60 districts in the GTA across the first two quarters of 2022, looking at factors such as unit sales and prices to determine the trajectory of each market.

To put it mildly, the report is very good news for new home buyers looking for a cheaper entry to the market, and possible cause for new homeowners to start feeling a touch of buyer's remorse over their recent purchases.

"Buyer sentiment changed virtually overnight as growing geopolitical concerns and spiralling inflation destabilized global markets, leaving the Bank of Canada little option but to raise interest rates," says Christopher Alexander, president of RE/MAX Canada.

"Those fast and furious incremental increases placed downward pressure on housing sales and prices, improving affordability on one hand, but eroding it on the other."

It hasn't translated to the dramatic correction some analysts have predicted but RE/MAX's report finds that Q2 values dipped from 10 to 15 per cent below Q1 levels in Durham, York, Halton, Dufferin, and Peel, with only nine markets registering an increase in average price in the second quarter of 2022.

Unsurprisingly, all nine markets to experience price appreciation were located in Toronto proper, still one of the most competitive and pricey locales to shop for a home in Canada.

"Given that the core has traditionally been more resilient, bolstered by strong demand, a finite supply of homes available for sale, higher household incomes, and greater equity at the top end of the market, the results are not unexpected," said Alexander.

"The price softening was clearly more evident in suburban areas and the outer perimeters of the 416, most of which experienced strong upward momentum during the height of the pandemic as buyers sought to leave the city."

Changes in working trends and a relative return to normal have triggered a reversal in the urban exodus that drove up housing prices in suburban markets. This means less competition and lower prices for these smaller markets, which are now reporting upticks in sales as they draw in price-conscious homebuyers.

"For those buyers that were active in Q2, improved housing affordability due to easing prices and the threat of higher rates down the road clearly provided the impetus for many to leap into detached home ownership," said Alexander.

Homebuyers seeking savings are now flocking to Ajax, Whitby, Clarington and Scugog in Durham Region, which all recorded spikes in second-quarter home sales. Markets like Clarington offer single-family homes for just over $1 million. That would seem bananas expensive just a few years ago, but in 2022, it's a steal.

RBC recently published its Monthly Housing Market Update, stating that "formerly overheating markets in Ontario have been the epicentre of the downturn to date."

The hardest-hit markets in terms of composite home price decline since the Feb. 2022 peak are Cambridge (-17%), Kitchener-Waterloo (-16%), Brantford (-14%), London (-14%) and Guelph (-10%).

These numbers look even worse as dollar values, with composite home prices declining by $166,000 in Cambridge and $95,000 in Guelph in the span of just five months.

It's bad news for anyone who invested in these markets at their peak, but others are using declining prices in the region as an opportunity to buy a new home.

RE/MAX states that softening prices have "brought out the bargain hunters at luxury price points," explaining sales spikes in some of Toronto's more affluent neighbourhoods like Bedford Park-Nortown, Lawrence Park, Rosedale, Moore Park, and Leaside.