when the bubble pops will it affect the condos and the cheaper areas?

Question

since people will have to sell their homes they might buy in cheaper areas or buy condos and also the rent rates will probably go up

Answer 1

Currently in MA we're experiencing an "correction" where RE prices are falling. At this point, the population is also declining and as a result, rents are slightly lower than they have been recently. Condo prices in the area have been falling, as well, but since the condos cost significantly less, the price reductions are much smaller. It will be interesting to see how long this lasts. It's a little nerve racking for RE investors.

Answer 2

Real estate "bubbles" tend to be somewhat localized. Even when the bubble pops, many people will take no action at all. If their income is high enough to keep making mortgage payments and if they have no need to move it will be a non-event for them.

People don't tend to pull up en masse and move to another part of the country or state when the housing market adjusts itself locally so the impact in lower cost areas is generally minimal.