Most of that expense is land value though. Which is why you see 800 sq ft housing built in the 1930s going for $1mm in San Francisco. What you are saying is true in the sense that attracting buyers to a specific area will push up land values there, but demand exists whether you build new housing or not. Those buyers must leave from somewhere which reduces demand elsewhere. The biggest issue right now is people everyone fight against zoning that allows us to build up. Which there is really no better way to meet housing needs and for christs sake we need to stop expanding and destroying the environment. The amount of forest ive seen destroyed for suburban expansion just in my lifetime is saddening.