Who determines the Cap?

[Vlad Denisov]

People say Cap Rates are the function of investor's appetite. If they are willing to pay less for NOI, Cap will go up.

What about the tenants on the other hand? If they decide that 1000$ for studio is too expensive, and they can't afford it based on economics they can make the prices to go down. That will decrease our NOI, and Cap will also go up.

So, is Cap really a representation of investors appetite or D&S of rental housing? Or maybe it's a combination of both?