There will be always lack of supply of housing. Its such an essential thing that it never becomes unused or unwanted. The combination of bad regulations where banks can give extremely high loans is the biggest issue. I would not be surprised if mortgages of 60 years will be possible where your total down payment is 4 times the actually price of the house.
Not true. As an overly simple thought experiment consider what happens to the market if a government were to dictate the construction of two units of housing per capita.
The issue is lack of supply. That is enforced by zoning, which is ultimately dictated by politicians, who know they won't get reelected if they make policy changes that gut a significant portion of their constituents' savings.
It's a fairly straightforward example of systemic dysfunction with no obvious solution.
Plenty of places in the world with an oversupply. Lots of examples in China
China (like the USA) didn't let the market handle it. China built without letting market demand dictate supply. USA did the opposite, didn't builders meet supply. They try, they try all the time to built more, they get stopped by nimbys and over regulation.
