Nothing you're saying makes any sense: 1. This isn't an example of systemic risk - I suggest you look up the phrase since you keep mentioning this. 2. Lowerin

Nothing you're saying makes any sense: 1. This isn't an example of systemic risk - I suggest you look up the phrase since you keep mentioning this. 2. Lowering rent has nothing to do with mortgage agreements - I have no idea what you'd think one has anything to do with the other. And no this isn't a huge issue in NYC. Sure, you're going to have a hard time refinancing an investment property that's not yielding much in rent, but you're going to have an even harder time if it's vacant. Rent is a price - most landlords are going to try to charge what they can given the market - this generally has nothing to do with how the property is financed. 3. If the markets for rentals and buying are related, that still doesn't change the fact that buying a place to rent out is demand-neutral in aggregate. Sure, there's one less housing unit to buy, but it also takes a renter out of the market. So if the markets are intertwined, then reduced rental demand -> reduced rent -> reduced housing price. The only thing that reduces demand for housing is moving out of the city.