I think the effect you mention is probably a lot more relevant to the people selling at below market to speculators that approached them, because if they were assuming that they could finance a home purchase in the city with the proceeds of the sale, they're going to find their purchasing power significantly weaker than they were probably expecting (given that they just clear 3x their original investment, "YAY!"). On top of that, with many agents speculating themselves, and a lot of foreign investors on the buy side of the market, they're likely to find that they are now swimming with sharks having just sold their boat.
Additional commentary: If you find yourself in this situation, you might as well try to get a loan to buy a new house before you sell your current shelter from the elements. If you're no longer able to get a loan for an amount that would get you a house in your area, perhaps that's an indication that you should be very careful with how you proceed. It still may be worth selling, even taking a below market offer (conceivably). But now you know that selling your house is going to mean moving to a more buyer friendly market in advance of committing yourself. Or... if you're the gambling type, renting in anticipation of a bubble burst (though I think heavy foreign investment messes with people's expectations of what is too hot for a given market; certainly it is fickle, but can potentially prop prices up significantly above historical levels for a long time).