surely they must be getting nervous?

In the Melbourne market if you had bought 3 years ago you would still be thousands of dollars behind, and with the market expected to be flat at best there is limited potential for growth in the foreseeable future.

With most investment properties heavily dependent on cap gains to offset the negative gearing how many 'investors' will be starting to feel the pinch, wondering if they have another 5+ years of zero to negative growth to endure?

And then after waiting 7+ years (a period during which the spruikers have told them the property is supposed to have doubled...) they will be thousands of dollars behind in a investment that is mathematically not capable of returning the gains we have seen over the last 20 years..Even the bulls are now starting to admit this.

Why would you hold and loose all that money with so much downside potential??

Add some more unemployment to the mix, a smattering of increased inflation/interest rates and people will cut their loses and dump their money drains at a increasing rate....