These house prices greatly exceed the value provided by a house (basically shelter from the elements, access to employment). An economist would call such margin

These house prices greatly exceed the value provided by a house (basically shelter from the elements, access to employment). An economist would call such margin a rent, and reason that supply would increase to take advantage of the profits to be made. A bubble is driven by price momentum, which in this case is a result of poor policy (zoning), too big to fail dynamics (what would happen to the pension funds in a crash?), and a blind eye to illegal activity (money laundering). Supply is going to have to increase to almost illogical levels to temper this momentum. I could imagine a public construction company tasked with nothing but building new towns outside the cities, complete with universities and subsidized employment opportunities, could begin to make a dent.