The Toronto condo market levelling off is probably a good thing but I don't see a crash coming. There's an important difference between now and the last time the market crashed in the late 80s: growth trends have changed significantly since then. We now have the Places to Grow growth plan, the Greenbelt, Oak Ridges Moraine, and increased transit investment. More importantly, there's now a very strong culture of urban living.
The number of detached houses being built in the GTA is less than half of what it was a decade ago, apartment starts have doubled, and total housing starts are constant. Condos are picking up the slack and the downtown population has skyrocketed. This is a long term trend.