Edit/update: this is receiving more upvotes and I think it is worth explicitly pointing out that while housing is up 60% over this time frame, the Sp500 is up 90+%, so this is not intended as a full on refutation of all the points made in the original post.
A few years ago I wrote a post highlighting what I felt were underappreciated considerations in home buying, most of which cut against the standard advice of homes as a major part of your investment portfolio. It garnered a lot of argument, most of which, I felt, boiled down to reference class forecasting over which mean housing would regress to for price trajectory: a more current one, or a more long term one.
Since then, housing has gone up 60+%. And the reason I think I got the reference class wrong is that I missed something very important about the US housing market. Since discovering it I find most people I mention it to are surprised by it.
I was very surprised that the US had the second lowest house price to income ratio in the world. It's less surprising when you consider that the income side of the equation is quite high, but still. Since then, the US has started dropping down the list and is currently in 6th. But this means hundreds of other countries have more expensive houses relative to local incomes. I was so busy looking at reference classes that are local price trends that I missed the major reference class of the US having started out as an outlier.
Were the US to continue to regress towards the world median of around 12, prices would need to appreciate another 2-2.5x from where they are at currently, which would put the median house at $900k-1.2MM. I failed to appreciate that most of the world has a much sharper property owner class divide and it wouldn't be all that surprising to see a relatively younger nation move in that direction over time. This also renders it much less surprising that investment firms are buying huge swathes of housing stock, even at the new higher rates.