Builders build for profit, and the math pushes them upmarket. A large share of a project's cost is fixed before a single wall goes up: land, planning, permits, impact fees. In a high-cost, heavily regulated state, that can run into six figures per lot before ground is broken. That fixed cost is a huge percentage of a modest home's budget and a small percentage of an expensive one, so the margin on a bigger, upgraded house is far fatter on the same lot. As long as buyers keep paying for size and upgrades, there's little incentive to build cheaper. Where builders do chase affordability, they usually get there by shrinking lots and square footage to fit more units in, rather than by accepting thinner margins. And most affordable new construction happens where land and regulation are cheap: lower-cost, faster-permitting metros put up far more entry-level homes than expensive coastal markets do. Two things would actually change the picture: a real incentive to build below the local median, which mostly doesn't exist today, or a meaningful drop in those fixed front-end costs. Absent one of those, expecting builders to voluntarily squeeze their own margins runs against the whole reason they're in business. Their job is to maximize profit, and a healthy building industry can sustain solid margins on its product without government stepping in to help.