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I agree on the diversified investment idea, but wouldn't also owning a home add even more diversity to ones portfolio? In a lot of these countries at the top of the wikipedia list it is possible to invest elsewhere as well as in a home.

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The typical person will only ever be able to afford at most one apartment/house (simply because if everyone has more than one, nobody would be willing to rent the "extra"). So, by definition, this means that for most people it would be a significant if not outright majority of their net worth. So no binding that much assets in one class would decrease the diversity. If you want to be exposed to housing: Buy an appropriate fonds for a fraction of the worth of a single apartment/house

Isn't that the problem with the canadian and American housing market?

Most people are all in on housing and can't afford to diversify after that, thus, the government cannot let the market crash without wiping out the wealth of the majority of its citizens

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