More insight into this situation:
"... housing prices in the top cities in 1980 were 25 percent higher than other cities in 1980; by 2016, they were more almost three times as high.
It might not seem surprising that housing is more expensive when everyone wants to move to a city. This simply reflects the basic law of supply and demand. However, housing is much more expensive than it has to be in prosperous cities because of a mechanism interfering with the unfettered operation of the housing market: zoning regulations. Throughout the United States, local regulations restrict the use of land in ways that make it impossible to provide the supply of housing that is required to meet its demand. This means that as areas grow, more and more workers are bidding for a limited set of places to live reasonably close to the cities where the good jobs are located.
The United States is relatively unique in having land use under local control, as opposed to national land-planning agencies in places like the UK and France. The problem this raises is that existing owners have an incentive to restrict housing supply, both to increase the local amenities (such as by having height restrictions on buildings to make the skyline more appealing) and to keep house prices high."
Via
Simon Johnson on Linkedin