Almost all of my friends are 100% or 99% invested in real estate.....
Almost every chart I look at implies Canadian housing is in a MASSIVE MASSIVE bubble.. our ecom is real estate..
When it fails I am wondering if others think BTC and PMs will lift off.
If they are getting high rental yield, it really doesn't matter if the housing market correct up to 50%.
Yup, if you treat real estate market as somehow isolated from the rest of the economy.
Even if prices correct 25% it will be a huge blow to the economy. And the rental yield won't help as it will plunge as well. Y'know crisis, unemployment...
From investor perspective, rental yield going down alone is not the primary factor of concern.
Let's say you buy a rental property, and get 6% yield a year. After 5 years, you already getting back 30% of the capital.
A 30% price correction will only set you back to square one and you are still getting return back every year in the form of rental. 10 more years and you will most likely be ahead of the game in term of profitability.