Yes but if prices rise, its 90-100% of the land price increase, and 0-10% of the house itself. That is land with all network connections and permit to build the house. It basically goes up only with material and labor costs.

House is often a necessary evil - its never what buyers imagine as ideal, but in comparison with going through the hell of building one's own (or also adding tearing down the old) its an acceptable compromise for many.

Life is too short, and no house is worth destroying a marriage.

This depends on where you live. In rural areas, and dying towns (most of america geographically), land prices have stayed about the same over the last decade or so. However, materials and labor have increased a lot. So there are certainly situations where the building itself inflates in value more than the land.

I heard an anecdote from a rural insurance agent that the fire insurance is crazy because repairing/rebuilding a house after a fire costs much more than the market price of the house + land, or an equivalent house + land nearby - the issue is that (in some areas) the rural house prices there are way down as there's no demand and everyone's leaving, while the costs of construction are sky high.

So if they offer a policy that covers the market value of the house, that's much less than what it would cost to repair/rebuild (so insured people can't afford to get their house back after a fire), and they don't want to offer full repair/rebuild value, as that incentivizes people to just burn the house down because in that case the insurance payment would be much more than what they can sell the house for.