That's a bit of a snarky way to put it, but this is correct; the parent comment is abusing the term "externality". The consequences of rental contracts for tenants in a free housing market are not an externality; the tenant is a party to the transaction.
In this case, the tenant isn't a party to the transaction, the tenant can't afford to be a party to the transaction at $8,000+ per month, that's my whole point.
They perhaps they should consider building more housing. With the bonkers prices there, I bet even with a portion dedicated to low income housing, stuff would still get built, as long as the rules were clear.
In theory, yes. In practice, local activists tend to demand new buildings be 100% affordable, and the result is generally gridlock where nothing at all gets built.
