One way would be to encourage alternative investments. It's actually really tough for non-wealthy Americans to invest in capital markets in an efficient way. A

One way would be to encourage alternative investments. It's actually really tough for non-wealthy Americans to invest in capital markets in an efficient way. Another would be to encourage them to really commit to the value of their homes (instead of the price). If property taxes in California rose with the value of homes, many more people in San Francisco would have found it expedient to (a) sell to developers or (b) let out their homes or (c) remodel their homes as denser housing. Well...(c) could have happened, if it were not so difficult to build in San Francisco, but that goes back to helping people find better ways to invest, by not discouraging commerce. Most investments work the way you describe: "...most increases in home value are not created by the homeowner." It's the same when you put money in a 401k or an index fund. Investing is putting capital out there and hoping it comes back. Doesn't make sense to advance this argument against home ownership as an investment.