Working less is the purpose of the economy.

> so some people can now just choose to work less

that's good - they're able to recover some of their time. Just because this "own time" doesn't count towards official GDP, doesn't mean it isn't an improvement.

Having less costs is not clear to me. Might be assuming commute with a car (very US-centric). Paying for all the coffee, snacks, lunch, proper office setup might not always be expensed by the employer and incur extra costs. But let's say, on average, it is true that now employees have less costs because of working remotely.

Lower costs could have other consequences, other than people working less: general inflation; inflating rents/property prices; lower salaries for the same job; longer working hours (officially or not)

I think what you mention is one possible effect, but there are many and it is not clear which one dominates.