housing markets aren't disjoint this way. people will consider moving up or down a couple tiers if it makes financial sense (or they don't have a choice). if the market for mansions is particularly tight, you will see rich people start buying condos instead, driving up prices in the midrange. some professionals that would otherwise be targeting those condos will be forced to consider more marginal homes in the low end, moving the price there as well. the same thing can happen in reverse if demand dries up at the high end, but you don't see that as often.