Agreed. However the proportion of speculators on IO loans...

Agreed. However the proportion of speculators on IO loans purchasing just now is very low.

There's SMSF, overseas investors, FHB, and of course the mum&dad purchasin their first investment property.

As with anything higher prices will squeeze everybody to some extent but to suggest it will cause a crash (implied or directly stated as this thread has done) is just plain stupid.

I may as well start a thread asking if renters can afford a 50% increase - it would be just as stupid.