So long as the only option to sell is to the government this could be a short term solution to bring the market rate down, especially if we can modify eminent domain to reimburse well below market rate.

Or how about just not steal stuff from people and have the government pay market rate, using taxes?

As long as we are taking stuff from people, what makes the most sense is to so it equally through taxes, and compensate people fairly by purchasing houses.

Or even better, the government could pay money to build more houses.

Landlords have been taking cash from the pockets of people who actually labor for millennia. Stealing? More like emancipating.