We can all learn something from observing this remarkable US company that has single-handedly done more to alter the course of the entire planet as it relates to electricity-fueled vehicles. In 2009 - just about 15 years ago - there were just 147 Tesla's on the road, today there are millions.

The prices of Tesla's soared between 2019 to 2023 as demand soared. But then, competition ramped up with new and traditional car makers entering EV markets. Now, inventories of EV's have soared. Most Tesla's are more expensive vehicles, hence a more limited market. Tesla responded to this new competition by lowering prices and profit margins to keep sales up. Now, as supply is scheduled to ramp up even further amongst its competitors, Tesla announced they would soon start making a much more affordable car option.

Take the above Tesla-nomics and apply this to housing:  for a decade too many developers have focused on building lots of luxury, more expensive homes. The reality is the time, effort and aggravation to build an expensive home is about the same as a cheaper one that delivers far lower profits. So of course, developers would do what is obvious, and logical.  But then market forces come back into focus when it becomes evident that too much of the same product is being created for not a big enough audience.

If Tesla is an indicator, I think we can all be more hopeful that more home builders will start focusing on where the really drastic housing need lies: the supply of more affordable, entry level homes. Hopefully governments will also see how important a role they play in helping this happen by streamlining and simplifying building codes and also providing practical incentives in the form of logical tax breaks to fuel this. Maybe the FED and governments will look closer at inflation numbers to see how housing is one of the biggest contributors and focus as much attention on bringing home building costs down as they do on rates?