Japan's example would suggest it's zoning. Tokyo is IMO very affordable for a metropolis (i.e. lots of people in middle income jobs can have a small but decent

Japan's example would suggest it's zoning. Tokyo is IMO very affordable for a metropolis (i.e. lots of people in middle income jobs can have a small but decent apartment here). And small apartments are less of an issue than you think, if a city has the right amenities. Room for children to play? There's tons of public play centers and playgrounds. A Garage? Don't need it, walk instead 5min to a superb transport network. Big kitchen? There's 50 restaurants within a 15min walk. Big relaxing bath? Go to a nearby public bath house and feel like an Ancient Roman. Need space for guests? Fold away your Futon, put up the heated Kotatsu-Table and have another room to use. More fun? Shibuya is 25min away. All yours for ~950 USD/month for a 35m2 or so apartment.