I see three colluding factors causing a global cost-of-living crisis:
- Increasing income inequality short-circuiting the backpressure role of market pricing (and, more specifically, the use of home ownership and immigrant-investor programs as a way to sidestep restrictive immigration systems)
- Countries attempting to replicate the American suburban lifestyle, which is economically unsustainable as voters are incentivized to constrain supply in favor of "line go up"
- The economic gravity of living in a large city.
The econ 101 explanation of markets is that increasing price lowers demand, but this is determined by the "elasticity" of the supply and demand curves. The shapes of the curves determines what the market will do when supply or demand shifts. But if these curves are straight lines, or "inelastic"; then suppliers or buyers do not compromise on quantity and the market gouges people.
Supply is inelastic: most cities are hostile to redevelopment and all the economically-viable land in the city has been used up. No matter how expensive housing gets, people will not be able to build more of it, so price goes up more. In fact, when housing gets more valuable, there is more political resistance to increasing supply, which makes prices go up more.
Demand is inelastic: most housing buyers need to own a house. Homelessness is at best inconvenient and at worst illegal. Moving out of a city is expensive, and will require finding new employment, possibly at a lower hourly rate or salary.
The end result is that the housing market works less like a market and more like NFTs pre-a-few-months-ago. It is politically engineered to ensure quick and profitable exits for the vast majority of homeowners. However, this process cannot go on forever; because eventually home costs will outstrip wages, which puts backpressure on the whole "line go up" thing.
This is where the rich and powerful come in. They do not respond to pricing backpressure the same way you or me do. If a flat in Portugal is a million euros instead of half a million, who the hell cares? They can afford it anyway. They represent "greatest fools" - people who can resolve a speculative bubble by just buying the asset and not caring about it.
It's also kind of a mistake to say that "the Portuguese can no longer afford to live in Portugal". The population is not a monolith; it's more correct to say that today's middle class Portuguese cannot afford to live in their own country, but prior decades' middle classes absolutely could have, and the price inflation in the housing market is specifically to the benefit of those people.