[dragonwriter]

One obvious possibility:

There are sufficient rich people outside of SF that want to be in SF to consume any reasonable housing growth.

Many other major cities already have most of the rich people that want to live in them (and some that really would prefer to live elsewhere, like SF.)

[closeparen]

If rich people’s housing consumption were bounded by their own needs for personal residences, it would be easy to outbuild them. This thread proposes that rich people consume many more homes than they can actually live in. So why don’t they draw some of those homes from other markets?

(I suspect this is because NIMBY policies in the face of population growth make SF housing an especially great investment, and that this advantage would disappear with zoning liberalization. Returns on the level of SF’s real estate market are hard to find in the stock market, for example. Why wouldn’t they speculate on it?)

[dragonwriter]

> If rich people’s housing consumption were bounded by their own needs for personal residences, it would be easy to outbuild them.

Globally, certainly; locally in particularly attractive areas? Probably not even if that were the case.

> This thread proposes that rich people consume many more homes than they can actually live in.

Which is obviously true, 2nd through nth homes that are kept idle most of the year, or even for years at a time, are a thing, and a person can't actually live in more than one at a time.

> So why don’t they draw some of those homes from other markets?

They do. But there's enough rich people that want to draw some of their consumption from SF to eat up quite a lot of expansion, until you actually make SF unattractive to rich people.