you've got it right there mozz. At this point, everyone who wants an investment property has one. before too long there will be many in negative equity and others getting pretty close. the most keenest proponents of real estate as an investment wont be able to buy when prices are cheaper as they will either be up to their ears in debt or will have lost faith property as an investment altogether. The equation as it stands for investors a year ago was 2% rental return plus potential 20% capital gain = 22% expected return. But its going to become 3% rental return plus potential 20% capital loss = -17% expected return. pretty bad if you ahve to pay another 7% in interest on top of that.
I remember going to auctions early 90's when there was only 1 or no bidders and houses would be on the market for a long time. Maybe we had no immigration back then. LOL.
