The typical person will only ever be able to afford at most one apartment/house (simply because if everyone has more than one, nobody would be willing to rent t

The typical person will only ever be able to afford at most one apartment/house (simply because if everyone has more than one, nobody would be willing to rent the "extra"). So, by definition, this means that for most people it would be a significant if not outright majority of their net worth. So no binding that much assets in one class would decrease the diversity. If you want to be exposed to housing: Buy an appropriate fonds for a fraction of the worth of a single apartment/house