[superuser2]

>establishing what society wants

When market participants are playing with roughly similar amounts of money, or at least roughly normally distributed amounts of money, sure. Markets give us the best consumer products. Part of how they do that is slicing the "budget" and "luxury" segments away into their own little worlds, where they don't do too much damage to everything else.

Inequality in the Bay Area housing market is so extreme that the best use of capital (in a market sense) is to exhaust it on the luxury segment and leave everyone else out in the cold. This might be "what society wants, weighted by salary" but that is importantly different from "what society wants" in this case.

Imagine if general income inequality was such that the auto industry found it optimal to produce only a few thousand Bugatti Veyrons, leaving everyone else in the cold. At the very least, we'd have to force it to produce some tanks and aircraft engines in case of war.