Is there a crash coming? Is it already here? Or has Toronto finally built up an immune system strong enough to avoid getting a cold when American cities are sneezing their faces off? The latest available numbers don’t look good. After more consecutive months of record sales than was healthy for our modesty, the number of resale homes purchased in the 416 in February 2008 was 14 per cent lower than it was in February 2007, the most significant drop in years.

Most real estate agents have been telling anyone who will listen that the decline was about the snow, with roads inaccessible and potential clients unwilling to turn house hunting into an alpine sport. Or perhaps buyers were trying to squeeze in a purchase before the launch of the dreaded land transfer tax. But what’s happening now can also, at least partly, be blamed on trepidation, always a real and substantial factor in market turns. The perceived economic threat seems to be provoking a range of reactions: sell and buy somewhere less volatile; sell and rent until the market settles; hunker down and build equity; or snap up more properties on the cheap.

“In the past four weeks,” says Sutton Group real estate agent Ophira Sutton, “every potential vendor that approached me was extremely apprehensive, wanting to know what to do.” Sutton figures people in the real estate market fall into two groups: those who read the financial pages and those who remain oblivious. In the former category, she had three clients who decided to get out of the revenue-property market in a single week in March. They’re just the beginning, she says. “In a few months, when the late risers wake up, it’s going to be massive.”

Mike Clarke of Keller Williams, consistently one of the biggest-selling agents in the city’s east end, agrees: “Usually when there’s a downturn in the U.S., Canada follows two years later.” He’s encour­aging his clients—especially the retired ones, for whom houses are the chief source of financial stability—to put their homes up as soon as possible. Half of his customers are selling now and moving to the 905, where house prices, as he says, “aren’t exactly bubbling.”

Patricia Griffin bought and moved into a house close to her children’s school, intending to keep her original home as a rental property. But fear of an imminent crash changed her mind, and she put it up for sale. When her home stalled, she even had it fluffed by The Unsellables, a show on HGTV. “I don’t think the market’s going to get any better than it is,” she says, figuring the approximately $300,000 difference between the listing price and what she paid for the house 12 years ago will put her in a more secure position than the rental income would.

For people whose real estate investments are also their homes, Sutton has unequivocal advice: if you think you might want to sell any time in the next five years, do it now; if not, get your financial house in order. “Do away with your holiday, and put more money into your house, so if there is a fluctuation,” she says—using one of the preferred real estate agent terms for whatever horror might befall us—“you’ll have more equity. Then, if you have to renegotiate the mortgage, you’ll be in a better position with the bank.”