I agree totally with Seth. 

There are a lot of scary similarities in the market right now as in 05, 06, but agree that the shortage of affordable housing (builders are just now starting to build them, way after the fact) and labor shortage (kids uninterested in the trades) will delay the arrival of a correction (agree it will come eventually).Plus the employment base in Phoenix is much more diverse now than 10-15 years ago (construction & financial) to a lot of technology and corporate support services recently added. 

I agree with Dick, you should recommend that your client read the landlord-tenant laws of your state. 

I agree with you, it’s a horrible investment vehicle  because of uncertainty of when will the loan be call due.

I agree with Amy.

This is what it takes to build houses everywhere else.I agree houses can be at 600 a sq ft but that includes the cost of land etc which is probably very significant in the Bay Area.

Conrad Kostrzewa have to agree with the populous here.

They still need a place to live, so they will either move back with their parents or will look for a place to rent.If you are looking for a rental in a luxury area, like Las Vegas or some beach vacation destination, then I agree that the rents there should go down if the market goes down, because people won't consider expensive rentals during the crisis times.Those are the things we consider when buying a rental property.

But I agree,  a discussion of the costs with your insurance person are in order.  

If they agree, cool.