SFR's are still strong and some of the outlying area's which in days gone by would not have seen investors drive through let alone purchase property in, are now good area's to checkout (Otara, Onehunga, Mangare Bridge etc).As always, if you're on the ground, there are deals to be had, but with property prices at 6-8 times the average household income, for me, the figures (currently) don't work with ROI's in the low single figures . . . . 

For example, I like to look at the long term trend of unemployment, median household income, and average home price.

You can go by median household salary , I think its $80k, so what ever top 30% is in OC that a good indicator.Last crash was due to the load process and people claiming to make what they didnt really make, it was the same thing that  led to Great Depression, the loan process has changed, so this correction is going to be town buying), or an unemployment crisis.

Also, the higher your household monthly earning, the better this technique works. 

http://en.wikipedia.org/wiki/Bristol,_VirginiaThe median income for a household in the city was $27,389, and the median income for a family was $34,266.

Even at a 200k household income I’m being told by family we will never get approved for a 500k home with that debt from rentals even if they’re cash flowing nicely.

My household income exceeds a MAGI of $150k. 

I see that number thrown around a lot, probably by a lot of folks making less than $50K/year household income. 

There was no empathy for the challenges those households were facing.

I didn't take any depreciation, I did a bit of improvements to the rental half of my 2 family, and I need to change head of household status and dependants.