There is all sorts of land in the world, but precious little of it abuts world-class ski resorts like Park City Mountain Resort, in Park City, Utah. And there are all sorts of houses of all variety of quality in the world.
But a small house, adjacent the ski slopes or near the pedestrian Main Street in Park City might fetch a very handsome price, compared to say, a similarly appointed property in Algonac, Michigan. The house in Park City didn’t cost more to build. It doesn’t cost more to maintain, so why would anyone in their right mind pay the equivalent of one month’s mortgage payment to (gasp!) rent a house in Park City?
This apparent discrepancy can’t be reconciled without a functioning market*, where individuals are permitted to dispose of or otherwise reciprocally exchange their belongings (whether you call them property or possession is beside the point) with other individuals.
For some people the proximity to “the best snow on earth” is worth it. They will gladly pay twice or thrice the “cost” of a comparable house in another city, in order to enjoy the panorama, the hiking trails, the downhill skiing, etc. They are willing to give more in exchange (i.e., to produce more) for it, than they would for most similar houses in most other locales. Or, they are willing to forgo other comforts. Of course, your mileage may vary.
All the talk about “cost” is a distraction: the only true costs are opportunity costs.
If you order beer with your dinner, you forgo soda. If you want a beer and a soda, you can’t eat as many slices of pizza without becoming quite uncomfortable. If you buy a house in the hills so you can have a pasture for your horses or a field for your dogs, you forgo a short commute to your job in the City. If you spend the afternoon raking your yard and cleaning your gutters, as I did two weekends ago, you forego sitting on the couch and reading a book, or taking the dog for a walk.
An individuals valuation of anything is based on his or her opportunity costs.
Never does he ask how much the house cost in the accounting sense, he concerns himself only with the asking price, and whether that price is above or below his value-threshold.
Any interference with this process is likely to result in queues, overuse, and neglect.
*NB: The arguments set forth above should not be read or interpreted to mean that the market for real property, currently and historically, has not been severely distorted by State violence. It has. And that’s a problem I’ll readily concede, but it is outside the scope of the present discussion.