I guess it depends how you look at it. If it's an investment property, then the principal payments are definitely part of the ongoing costs (i.e. you need to come up with that money one way or another even if it's vacant). And obviously if the price drops those forced savings can evaporate (at least temporarily). On a 25 year 3% mortgage, a 10% drop in property value can wipe out the first 3.5-4 years of principal payments. With a 20% drop, your principal payments wouldn't cover the loss until year 8.
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