Sellers asked to be realistic as market cools

The greater Toronto real estate market continued its slide in the first half of January, according to figures released today.

Total house sales were cut in half compared with the same period last year, while $35,000 was knocked off the average value of each sale, a drop of almost 10% on 2008.

Toronto Real Estate Board president Maureen O’Neill said the cooling will take some getting used to, but expects growth once potential sellers and buyers adapt to the new economic conditions.

“Consumers have had it very good for the last 10 years. They can’t remember seeing prices going down,” she said. “People need to be more realistic and respect the current market.”

GTA realtors reported 888 sales in the first two weeks of this year, down from 1,776 in 2008. The average price fell from $367,574 to $332,495.

Gilles Duranton, a professor of economics at the University of Toronto, said nobody knows when the good times will return, but greater Toronto is better placed than most markets.

“We have to remember this is a downturn that is affecting the whole continent, if not the world,” he said. “We haven’t seen the kind of explosion in price here that happened in other North American cities, so the correction won’t be as severe,” he said.

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