A much more salient cause is the 0% (base) interest rates. Obviously you can afford the a larger mortgage at 3% than at 7%. This should eventually reverse itsel

A much more salient cause is the 0% (base) interest rates. Obviously you can afford the a larger mortgage at 3% than at 7%. This should eventually reverse itself with higher interest rates, but right now no one with a 3% mortgage is selling, because then they'd be stuck with a higher mortgage, so there are even fewer houses available for purchase, but roughly the same demand. I also think AirBnB has increased housing prices, although I don't know how one would find evidence for that. But with AirBnB, now your house can also produce income, so the price of a home should rise to account for that. Plus it reduces supply, because some people rent out homes on AirBnB without even living in them.