[anamax]

> If someone builds an expensive condo, yes this increases supply of housing in the area, but in the event that prices increase all over the place due to cartel-like behavior

Umm, no.

Adding a new expensive housing to a market does not increase the demand for existing inexpensive housing.

It can have the effect of reducing the demand for other expensive housing, as in "why should I pay a lot of money for old?"