[all2]

The grossly inflated price comes from where though? I'd put it to you that a ban on usury where real estate was concerned would crush land values over night. Easy money (cheap loans) allow speculation, and speculation is one of the primary drivers of land value.

[epistasis]

A far bigger driver of speculation is scarcity. Without that scarcity, loans would do nothing to drive land value.

Tight zoning is the primary driver of real estate value, because it further increases the scarcity of land. It makes small homes worth absolutely insane values.

Further, though eliminating cheap loans will limit the amount that people can pay for the real estate, it also reduces the ability of people to pay, so every person is back to the same place with scarcity. So though eliminating loans may change the face value of the cost of housing, in real terms, eliminating loans does nothing for ordinary's people ability to obtain housing where they want it. Only increasing supply by removing overly restrictive zoning will actually improve the material conditions for people.

All that said, we should definitely eliminate financial products in the US like the 30 year fixed rate mortgage, a government creation that does inflate prices, while reducing the ability of people to move. But we should get rid of it primarily because it reduces the ability of people to move by trapping them into the home they were in when mortgage rates were low.

[voisin]

What you call usury is also a government caused problem. It’s almost like 30+ year amortizations and ultra low interest rates… weren’t good for affordability. But now everyone but the government itself is the cause of this issue (in the government’s humble opinion). Blame immigrants, developers, AirBNB, investors… anyone but government! And if you must blame government, blame some other level of government!

[all2]

Tbh, I think you nailed it. Policy largely drives the system in a law avoiding society.