australia's very own subprime crisis looming, page-198

justis.."So lets say property prices drop 10% over the next year, no big deal as you don't realise a loss unless you sell. "

Lets say you recently put 50k down on a 500k property owing the bank 450k.
Your 10% loss equals 50k or a 100% loss of capital right there.

Lets say you put no money down and borrowed against your free hold 500k ppor. you are now 100k down the creek not counting costs etc.

it can be a pretty big deal!