Comment by dfee

Your notion of “supply and demand” doesn’t allow for the predicates to the problem: new buildings are regulated through zoning and permits.

While life might be simpler with your model, it doesn’t fit reality well.

Here’s a decent analysis of the California situation with mismatched supply and demand and the headache that goes along with the state’s governance: http://www.latimes.com/business/la-fi-home-prices-20170725-s...