It's impossible to control skyrocketing house prices in booming tech areas with anything other than a massive amount of new housing developments.

Even if everything you can buy suddenly got 10% cheaper, the houses in those areas would immediately increase back to the old level because the prices is driven by a high demand relative to supply.

Makes sense. To me it just seems they act as if inflation was low but in reality they are creating huge asset inflation with the low interest policy.

Housing is not experiencing rampant inflation when you look at the nation as a whole. We have one currency so the Fed has to try to strike a balance that works for everyone.

That's an interesting thought, does the government have cpi-like numbers for different localities, or just the one number?

Rents are included in cpi, but home prices aren't. Now, of course they are correlated, but that's certainly one of the arguments against using cpi.

edit: answered my own question, the bureau of labor statistics has more numbers than you can shake a stick at.

I want to remark that its not inflation, its just regular demand shock to the market. Specially housing takes time to match the supply to demand.

Inflation is generalized increased of nominal costs, not particular to an asset, nor in 'real terms' which is what is happening here.

Isn't it very localized?

Based on this it's nationwide: https://fred.stlouisfed.org/series/CSUSHPINSA

That says it’s about back to where it was 10 years ago. Mind you there was a fairly big run up to the peak of the bubble but most people here aren’t complaining about prices having risen again to 2007 levels.