Higher interest rates and a recession could potentially change things in a hurry. I haven't thought through all the possible ramifications, as we wouldn't necessarily be impacted as far as I can see (don't have investment properties, aren't looking to move, and didn't stretch ourselves when we bought almost 15 years ago), but I see a few potential red flags.
One big one is the advertising of properties to investors. People were flush with cash because of all the stimulus, and the low interest rates were also obviously super appealing. Add to that the growth of VRBO and Airbnb over the last 10 years...I'm a little concerned we have a bit of a growing investment bubble. It's an intriguing investment, but I know a lot of these people plan to be able to pay for their mortgages by getting at least 12 weeks of max rental rates (the weekly rate equaling at least 1 month's mortgage). Then they need off-peak weeks to pay for insurance, taxes, upgrades, and make a profit. If we run into a recession, and people aren't able to take vacations the way they have been, these investors aren't going to be able to pay their mortgages, so they're going to start to flood the market with rental properties. That would help alleviate the housing shortage problem, but it would also start to make home prices drop. That of course could amplify the problem for those investors and possibly accelerate the desire to get out - they don't want to lose money on their investment. Could be interesting. Hopefully that doesn't happen. Interested to see what other angles the rest of you see.