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At some point the cartel will run out of capital. Before then, the mispricing becomes evident enough that speculators come in on the other side and burst the bu

• pixl97 4y ago
  The (rental) market can remain irrational far longer than you (the renter) can remain solvent.
• maxsilver 4y ago
  > At some point the cartel will run out of capital They can't really though, at least not anytime soon -- the cycle itself gives the cartel more capital. If they buy units as they come onto the market, they hold the equity in those units, which they can instantly mortgage out to get more capital, which they can spend on more units, which they can instantly mortgage out to get more capital. This is especially true when interest rates are low, (the lower rates are, the cheaper this cycle is to continue -- at interest rates below the real inflation rate, they effectively get given free money to do this) And yes, it exposes them to the risk that eventually this bubble could pop, but it could take many years (decades even?) before that happens.