No, the issue is artificial friction added to the new construction process which keeps overall supply lower than demand, and pushes prices up continuously.

It’s good to have building codes, because we need safe buildings. But we should offset their existence by slightly subsidizing new construction. Basically we want to enable as closely as possible the natural balancing between supply and demand. Right now, the heavy regulation (both legitimate and overreach) of new construction, as well as the high paperwork and hassle cost, and the uncertainty of permitting or of permitting timeline, all those things are a big finger on the scale pushing supply down.

Maintaining a constant downward adjustment on the amount of new housing constructed each year is a recipe for exactly this situation we have now: disrespect of tenants by landlords, and exploding rent prices.

We don’t have a free market in housing. We have a tightly controlled market where new supply is constantly gatekept and thereby suppressed.

I mentioned building codes but there’s also nimbyist zoning laws. There are plenty of places where a 100-unit apartment building would be a more profitable use of space, but zoning prevents the construction of more than 10 single family homes.

We do this for lots of reasons, such as maintaining the architectural character of the town, protecting rich people’s views by prevnring tall buildings, avoiding health issues, managing transportation demand, etc etc.

But we need to be conscious of the fact that the price we pay for all those other benefits, is that we have a housing shortage.