Keep in mind, community permit policies determine whether housing prices rise or fall, since they impact supply. So, it appears the real bad guy are not investors buying homes but government policy restricting housing.

My guess is that if government permitting policies began to promote higher density housing, that real estate prices would crash. But when government creates artificial scarcity, prices rise. Smart investors look for underlying government policies that will cause assets to rise faster than inflation.

A great example of how government contributes to higher housing costs. Regulation can be quite expensive... sometimes it is necessary for safety reasons, but other times it simply creates "winners and losers".