Like Chicken Little, you could be forgiven for thinking that the sky is falling when there's a dip in the prices of Toronto condos and you don't know any better than to run and tell the king. But as anyone who has followed the real estate market knows, periodic ups and downs are completely normal and are not a cause for despair. So whether you're looking to buy or sell a property, let us give you a realistic outlook on what the market might do while you're exploring it.

Real estate prices are entirely dependant on the consumer. If there's relatively few people who are looking to buy the Red Hook real estate that's for sale, the prices will be lower. If there are more people competing for only a few houses for sale, the prices will be high. It's all about what someone is willing to pay for a property. Therefore the number of people looking for homes versus the number of people selling homes determines the state of the market at any given time.

In a normal situation, the market is changing all the time because every time a new buyer or seller enters the market the game changes just a little bit. If Ancaster home builders overestimate the number of people who will move into the city in the next year and build too many houses, they will have to lower their asking price and vice versa. Therefore if you're looking at the average market values while you're trying to buy or sell and are noticing them changing weekly or even daily, this is no cause for alarm.

This is not to say, however, that things don't occasionally get out of hand. In a situation where the figures are skewed heavily to one side for a prolonged length of time, one side is getting all the advantages from the Toronto real estate. In a situation where buyers heavily outnumber the sellers (such as in rapidly expanding cities) it is called a Seller's Market and the buyers are often forced into bidding wars over properties. In a situation where the number of homes for sale outnumber the people buying homes, it's called a Buyer's Market and buyers can walk away with a house for a song.

By keeping abreast of the real estate news, which you can find on the websites of realtors, real estate associations, and Canadian mortgage companies, you can predict when a situation that could be to your advantage is coming up by looking at the real estate trends. Home prices that are steadily climbing indicate a seller's market is approaching, and home price graphs with a downward slope mean good news for buyers.