> In places where people are concerned about a housing shortage, the majority of the cost is land.
This is true in constrained areas like SF bay area. Back when I was digging into real estate economics, I found data on this from HUD, they have a price indicator dataset. https://www.fhfa.gov/research/papers/wp1901
Also look at the Lincoln Institute, they have fantastic studies.
In places like San Francisco, 80% of the value is in the land. In other places, it's 15-35%. The historical national average is about 33% but now it's a bit higher.
Completely different economic rules dominate in constrained areas like San Francisco versus unconstrained areas like Phoenix. But most housing is in unconstrained areas, the constrained areas are expensive elite sections. In most of the country, house prices track construction costs, and the high land prices are effectively economic segregation that weed out antisocial people, causing these areas to be even more desirable and sought after, which raises the bar even higher. All "nice areas" are nice because of gatekeeping, and in the US this is usually high land prices. Traditionally, each city had its own immigration policy, and they would chase out of town people who weren't seen as productive or who were antisocial, and as a result, you would have poor people living on the outskirts of towns.
In places like SF, richer people move in, house prices go up but there is not much change in the population. In other places, more people move in and more housing is built.
A lot of the debate surrounding housing boils down to people imagining a world where SF housing rules applies and thinking this is appropriate national policy, or others looking at national datasets and thinking this would apply to places like SF. Much of housing and land economics seems counterintuitive, for example how cities get less dense over time, e.g. https://www.lincolninst.edu/publications/working-papers/pers...
But once you learn how to think about it, it all makes sense.