Trolling Craigslist you can find some properties where the realtor statement "real estate only goes up" does not hold true.
Check out this beauty at 2909 Allenhurst St. This property was purchased on September 30, 2005 for $264,000. However, due to the inability of the borrower to make payments, Wells Fargo foreclosed on these folks on January 29, 2007. Now the property is listed for sale for $225,000:
Loads of potential in this 3bd/1.75ba home. Roomy great room with fireplace, tiled kitchen with breakfast bar, tile flooring, neutral colors, cov’d patio, 2-car garage. Priced below comparable properties in the neighborhood. Great for 1st-timer or investor. MUST SELL! $222,500
Multiply this outcome by the thousands and you can get the picture of how this speculative mania will end. Right now there are 100-150 NOD's filed a week in Kern County; I predict that in a year we will have 200-250 NOD's per week in Kern County. Credit is tightening, inventory is increasing and foreclosures are rising; REIC, the pain is only beginning.