Gas Prices

• Gas prices can have a direct effect on the values of homes. Low gas prices mean people can afford to commute to work from long distances so they can have a bigger house. If gas prices increase, people may want to move closer to the city. Prices in these suburbs decline and it has a ripple effect on the rest of the market.
  
  

Inventory

• One of the most prominent factors that plays a role in the price of housing is inventory. When the market goes through a down period, a large amount of inventory is usually involved. Once the existing inventory of houses is sold, the prices of the houses that become available will be higher. When builders continually build houses and increase the amount of inventory available, it drives down the price of everyone else's property.
  
  

Interest Rates

• When interest rates are low, buyers can afford to pay more for houses and prices across the market tend to rise. Higher interest rates cause sellers to realize that buyers cannot afford to make larger payments and end up lowering their prices. When market interest rates decrease, this tends to slowly raise the price of housing.
  
  

Labor Costs

• When the minimum wage is raised, it tends to eventually lead to higher housing prices. When labor costs increase, this requires builders to raise their square-foot prices when building a new house. This leads to the selling price of the house increasing so the builder can cover his costs. This will usually be a gradual increase.