alt Hacker News> More demand for a fixed set of land drives prices up.
This works because both you and GP specified "[free-standing] house". This is not true of homes, where multiple homes can occupy the same land - just 15 feet higher or lower
Perhaps someday more American cities will discover the third dimension, allowing for cheaper housing
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I think you're focusing on the wrong thing and missing the point. Housing supplies have not significantly increased with population growth (demand) in decades--thus the price equilibrium has moved up. I don't care if you build up or out and neither does the law of supply and demand. The left gets all hung up on 'the right kind of housing' and doesn't realize they're part of the problem--making it harder to build housing (of any kind) is pushing housing costs up.
Don't get me wrong, there is a place for units/apartments, especially in the face of homelessness. But no one dreams of owning an apartment as opposed to a free-standing house.
The dream/desire is the thing.