The only things I feel compelled to add (as Seattle is facing a similar condition to 'the bay area' now), are that at a mega-city, county, and state, maybe even federal level, there needs to be a 'resource recycling collector' that kicks in when the market fails; and that building codes should be much stricter about quality of life issues.

There are neighborhoods that simply need /vastly/ more density than currently exists, or which have predominantly older buildings and infrastructure. Those areas should be bought out en-mass by the people (government), and sale encouraged at some fixed ratio of existing market valuations consistent with values prior to market insanity.

The entire area can then be taken offline and upgraded from the base up with a full-refresh; ideally at a density target and with modern building codes and designs.

Those building codes should make apartment/condo living affordable, as well as requiring sufficient space, isolation, and quality of life for all involved. It should be less costly and higher quality of life to live in a city, not more costly and lower quality of life as it is now.