[Yes2020]

There was an interesting article on what could be driving housing inflation a couple of weeks ago-cant find the link. It was about the soaring prices on billionaires row in Manhattan.

The idea in the article is investors are trying to increase the liquidity of real estate assets down the line towards the higher liquidity of stocks. The results are more investors seeking returns from real estate, buying up buildings as if they were stocks. This can cause a fast step change in demand against the slower increase in supply, driving up prices quickly, which in turn drives up rents.

Energy costs hit this inflation as well, because most buildings need heating and/ or cooling during the year. With the supply of traditional energy being artificially restricted, this drives up the costs associated with real estate, increasing everyone's costs. Look at what's happening in NYC.