BiggerPockets

That's a great question, I would like to see people's thoughts on this one as well.
IMO, this would be the case. If people are losing homes left and right they're still going to need an affordable place to shack up. I don't see high end or luxory rentals going up in demand, but you'd think that lower to moderately priced rentals would see a spike in demand.

I agree with Mike that there is not necessarily a correlation. In a depressed job market (Detroit, for instance) there will be lots of foreclosures but since there are no jobs available, people will leave the area and the rental demand will drop.

Sorry guys I meant to write 20% down in my original post not 80. Wondering if anyone has opinion on the vegas market specifically?

I can speak firsthand for So. Texas. In the 2 years I've been buying, the demand for rentals has never been as strong. I've literally had a waiting list for several cities I own homes in. I'm finding some of that in Dallas this week. I'm looking at apt buildings, and it amazes me how many are 90% or better.
I think it is simple economics as long as there are jobs. People lose their home to foreclosure. The bank takes it over and sits on it. This is a double whammy. Same demand for housing. Less available due to banks holding them.We also have more people coming across the border because of problems there. I'm not losing a single day of rent when vacancies happen the last 4-6 months.

It's always a combination of location and market.

My college rentals are in demand as enrollment increases.

My low-income rentals are soft as businesses/government cut back hours and renters move back in with relatives.

Unfortunately there's a steady supply of investors bidding up foreclosure prices in prime rental areas, sacrificing cash flow for expected appreciation.

Maybe they're geniuses but it's not a bet I'm willing to make.

Hey Larry - way to spread rumors! I love it when people bash Detroit just becasue it is such a popular thing to do. Say what you want about the city but you can't deny (if you know the trut truth that is) that is has one of the most stable rental markets in the US.

I have invested in the city for over a decade now - hundreds and hundreds of homes and 99% of them rented in 2-3 weeks after move out and that is for both first rents and re-rents.

The unemployment rate is sky high in the city but there is a very stable rental market in Detroit...this year alone 20 homes bought / rehabbed and 19 homes filled in under 3 weeks - 1 home took 5...each had 2-3 qualifyed tenants to pick from.

As for the OP question - it isn't that black and white. No "formal equation". Sometimes yes sometimes no.