Right, unless those flippers paid with straight cash, they are going to have a hard time raising more money to buy more houses, and they might go underwater on the current ones.

To see what that looks like on steroids, China's economy is at real risk of recession due to property developers running out of cash and failing to build promised developments. (Most apartments in China are purchased before construction starts, so you can buy a house and not end up with one in the end.)