- The state does not own much land in US cities. So that means buying existing properties at great expense and demolishing/rebuilding at even greater expense.
- The "veto" ability for existing residents to oppose new projects in the US is incredibly strong. Even existing public housing residents will oppose new ones built near them.
- Construction costs are unnaturally high in the US for a variety of factors - municipal governments can't seem to get out of their own way when it comes to zoning requirements and etc.
For California, they ended up paying $1 million dollars per unit! Much more than they would have just buying existing properties for individuals.
I don't think it's a problem of "market ideology". I think it's easier to prescribe it as a general policy failure. Vienna has a set of favorable circumstances that are not easily duplicated to other urban areas, and places like China can just ignore legal rights of their citizens to build whatever they want.
I get incredibly annoyed when I read anglo hottakes on housing these days.
It's a solved problem in other parts of the world, but it doesn't fit the market ideology, so it gets ignored.