My wife is also in the real estate market: the reality is that people's incentives are not maximized on house value, they also care about other things , like safety, patient, attention, etc.

It is what it is. RE is not a perfect market because goods really cant be commoditized.

I reiterate my point with one more argument: the average income of a realtor is very low: they make very little money. The number of active realtors is almost perfectly correlated with house prices: that means a highly competitive , and thus relatively efficient, system.