> Is a market where housing supply meets demand, housing is a depreciating asset.

How so? Supposedly house prices increased by 50% in 5 years there. So obviously it does not meet demand...

> Why would you want to buy if renting is cheaper?

Because it's usually considerably cheaper long-term? Rent prices go up all the time, so you'd lose a very significant amount of money over 10-20+ years.

If it is cheaper to buy than to rent, then presumably they can buy a house. The difference in prices just has to be bigger than interest rates and it becomes cost-effective to get a loan.

Say rents are >6% of the equivalent cost of ownership, then a mortgage at 6% will be cheaper than renting. So renting can't get that out of control relative to house prices in the long term, they have to go crazy together in a way that favours people who always lived in an area.

I mean in normal markets you'd expect price-to-rent ratio to up to 20x. If it's higher buying probably doesn't make a lot of sense unless you expect prices to continue growing at a very fast rate (which of course makes it too risky if it's your primary home).

In Taipei it seems to be about 50x.

So if you live there and want to have children it's certainly not cheaper (you can't afford it anyway) and you end up paying already very high and continuously increasing rent payments all your life. By the time you retire you have no equity and very little savings.

Situation is the the same in a lot of major cities. It's just that rents are naturally caped at some proportion of median income (that leaves you with very little disposable income) while real estate prices have become almost completely detached from it.