> When you make housing an investment, by definition, it has to become less affordable in the future. Not really. It's fine to "invest" in something that just

> When you make housing an investment, by definition, it has to become less affordable in the future. Not really. It's fine to "invest" in something that just outperforms holding cash, or bank deposits. Trillions of dollars are invested in treasuries. You can even invest in something with negative expected returns, if it hedges exactly the risks you will face in the future (eg, the risk of accommodation costs rising is offset by owning a house, because you will always need somewhere to live). So you can make housing an attractive investment for medium-net-worth individuals, say, that section of the population that can afford to own 1-2 houses over their lifetime, without it becoming less affordable over time. You can use tax incentives to tweak this further: many jurisdictions give you a lot of tax relief on your first home. So, what causes house prices to rise faster than incomes is not an approach of making housing an investment per se, but a focus on making it an investment competitive with the stock market and attractive to institutional investors seeking outright yield.