Real estate prices are now, and always will be based on supply and demand.

Is there a big supply or tight?

As a RE seller and I sell a lot of property each year that we own well over 70 properties and almost all the pre approval letters come in right at the max they can borrow IE they get approved for 400k they don't shop for a 250k house they go right to the max.For the Rich and famous I have bought those as well  ( well at least sports stars) and I will mention one by name since he is deceased..

It all depends on supply and demand, market conditions that can change weekly, availability of funds, specific type o deal your business plan directs you to next, etc...

For example, since HUD no longer supplies their appraisal to the buyer and the buyer has to get their own appraisal it has made it more difficult for owner occupants to get an FHA loan on a HUD since the appraiser wants to see the utilities on when he does the appraisal. 

A lot of BPers have discussed the supply response in Denver. 

We are in the process of getting our first two rental properties (using OPM) out in PA where we both went to school and played sports (Lafayette and Lehigh.

We know that home supply is generally inelastic, meaning inventory can not expand or contract severely in the short term therefore we all see that a small increase in demand has a much bigger impact on home prices (San Francisco)  and conversely an excess housing stock vs. demand (Cleveland) means much lower home prices as a whole.If you simply compare the variance of Zillows Price to Rent ratios to their average home price indices over the past 7 years you will see this relationship. 

There is an abundant supply here.

The reasons that property is purchased, ranges from commuter appeal, recreation, retirement, investment, sports (fishing, hunting, skiing, golf, etc.)