What is a main hindrance to market-driven development providing affordable housing?

A primary hindrance to market-driven development providing affordable housing is the way speculation and investment can distort the purpose of housing. When housing is viewed primarily as an investment opportunity rather than a fundamental need, it tends to lead to inflated prices that make homes less accessible to the average person. This speculative behavior can result in housing being built or retained mainly for profit, driving up costs and prioritizing high-end developments over affordable options. The focus shifts from providing homes for people to maximizing returns for investors, which is a significant barrier to achieving truly affordable housing solutions.

This situation is exacerbated when investor interest leads to bidding wars and increased valuations that further separate housing prices from actual market demands for affordable living. The consequence is a housing market where low- and middle-income individuals struggle to find suitable and affordable options, significantly impacting community diversity and stability.