[xg15]

> This doesn't make any sense - real estate speculation would increase the purchase price of real estate but cannot directly impact rental rates.

Not an expert, but seems to me they could indirectly, by reducing supply of rentable apartments:

Consider district X with n rentable apartments located in m buildings.

Now some buildings get vacated and are kept empty by speculators.

The apartments from those houses are not anymore available for rent, however, the demand for rentable apartments stays the same - therefore landlords of the remaining apartments now have leeway to raise rent without being punished by the market.

[candybar]

This doesn't have much to do with speculation - the decision to rent or not is something that every owner can make and the economics of the decision don't depend on whether your investment was based on price speculation.

Generally speaking, wherever you have a strong rental market, vacancy is low - it doesn't make sense to keep units vacant in a strong rental market. Speculators aren't some magical creatures to whom normal rules don't apply - real estate speculators are merely investors who believe that prices will move in their favor in the future. That doesn't mean they are any more incentivized to forego rental income, which generally is a large component of the return on any real estate investment.

Edit: I'll add that if you go by classical economics, you'd predict rent to go down if price speculation is excessive, since builders respond to real estate price and if price is sufficiently above cost of construction, this leads to construction of more units, which increases supply and depresses rent.

My general understanding is that this doesn't necessarily work that way because the fundamental factors behind what makes a location attractive don't change - within reason, if you build more, in the long run, you just become a larger, denser version of what you were, which just attracts more people.