The under 500K mark is big because of the 417K conventional loan limit. All houses under that can be bought with conventional loans and 20% down. Granted all dont have 20% down but enough have that and more to impact the market. The income required for a 417K loan these days is about $100K which isnt tough for a one professional or a 2 income family. These numbers are for 500k and as you go down in price there are more people who can meet the 20% down or the required income. A nice home in a nice location will be contested under this price.