house price appreciation is due to historical population growth creating scarcity, and cheaper money allowing for higher and higher leverage
If was just population growth and cheap money, you might expect housing prices would rise everywhere, but prices have dropped in places like Buffalo, Detroit, Cleveland. The housing price bubble is in large part because there is a been a highly uneven distribution of high value job creation. Also, a side effect of the influx of high paying jobs is that local amenities spring up (restaurants, grocery stores, coffee, breweries - typical gentrification), and that reinforces the demand and pushes prices even higher.
Drive across the country and it is clear land scarcity is not a problem, it is just that too many people want or need to live in the same small areas.
If was just population growth and cheap money, you might expect housing prices would rise everywhere, but prices have dropped in places like Buffalo, Detroit, Cleveland. The housing price bubble is in large part because there is a been a highly uneven distribution of high value job creation. Also, a side effect of the influx of high paying jobs is that local amenities spring up (restaurants, grocery stores, coffee, breweries - typical gentrification), and that reinforces the demand and pushes prices even higher.
Drive across the country and it is clear land scarcity is not a problem, it is just that too many people want or need to live in the same small areas.