Capitalism has no problems creating more living space - when it’s not being strangled by building codes which specifically prohibit building more living space.
Sure we have developers in Texas, Oklahoma, Florida, etc plopping down houses >$300-500k, but can the average person afford them? Yes I agree building codes in places like California make houses expensive, but the current market in the United States does not incentivize building affordable housing.
Because the building codes drive up the costs!
When more supply goes on the market, existing stock goes lower in price - when there is enough supply.
That is how it always has been.
Even old ‘shotgun shacks’ are too expensive because zoning restrictions (and too much easy money) has caused everyone to inflate everything.
> When more supply goes on the market, existing stock goes lower in price - when there is enough supply.
Yes, that's part of why the housing stock today is nicer than the housing stock 200 years ago: over time the average newly built home was always better than existing houses.
These are all areas with similar levels of ‘desirable is constrained’. Or perhaps worded better as ‘people want the top x percent, not just the same thing in bulk’.
Most of the other things you’re talking about, it’s easier to scale up production without hurting desirability.
For instance, if commute/neighborhoods/climate literally didn’t matter, everyone complaining about housing costs would just move to Rural Kansas or North Dakota and problem solved for dirt cheap.
Instead everyone is complaining about how nice new housing in city-of-choice-close-to-work is unaffordable.
Well of course it is - people are restricting building to keep it nice (by their standards), which is why folks want to move there, which is restricting supply - and with easier money (historically) that is causing increased bidding and increased costs.
What has become more and more expensive is the get-a-piece-of-paper-at-the-end part of education.
That being also the most regulated part of education, I wouldn't necessarily blame in on 'markets' or 'capitalism'.