[fuscy]

I'm not an economist but I'm pretty sure that the price of housing is determined by supply and demand.

Wouldn't housing be more affordable if more houses would be allowed to be built?

Cities seem to enjoy banning people from using their own property as they deem fit. Instead less bureaucracy with faster and cheaper costs for building housing would curb this phenomenon at the roots.

This doesn't solve issues where there isn't enough land (like an island) but in most cases it should work.

[JoeAltmaier]

Land prices determine the larger share of a house price. That depends on what other purposes than housing, the land can be put to. Also infrastructure cost, taxes and transportation.

And nobody is going to build a new house if they can't make good money on it. So its all tied up in interest rates, expected rate of return for capital etc.

Supply can matter say in a depressed area where folks are in a hurry to get out from under a mortgage. But nobody is making money there. Its not a typical house price at all.