When a good's supply is constrained, it becomes a store of value. See: gold.
Strangely enough, if housing got built in response to price increases, there would likely be less unused housing, because it would be seen less as a way to store capital.
Strangely enough, if housing got built in response to price increases, there would likely be less unused housing, because it would be seen less as a way to store capital.
This is because the store of value quickly becomes a millstone around the owner's neck if it isnt being used efficiently. That's a feature if you want a healthy city and a bug if you're one of the ultra wealthy.
The UK is a bit like San Francisco in this respect. There are no property taxes, just something called a council tax (which is basically a poll tax) and "stamp duty" which is levied only on property transactions.
The latter is particularly toxic because it actively encourages property hoarding.
This is why London is an alpha world+ city which can't build up to save its life.
By giving the public any say at all, they push and push until they have restricted growth. It's far better for everyone to not ask anyone but the owner of the property how tall they want to build.
That doesn't make sense as stated, because every physical commodity is supply-constrained to some extent, even and especially the ones that are extremely bad stores of value. Picking on Fermium (it has a nice atomic number) - Fermium is supply constrained and it makes a horrible store of value because it rapidly morphs into something else.
Gold is a well-liked store of value because it is absurdly stable (about as close as we can practically get to indestructible) and roughly the easiest to physically store out of all the durable candidates.