If every middle class single-family detached home in a sprawling metropolitan area like Los Angeles were each replaced with two luxury condos over a short period, would average real estate prices rise or fall? Would they go in one direction first and then the other direction later?
Or the opposite, if every two luxury homes were replaced by a single middle-class home occupying both parcels, would prices rise or fall?
I'm asking this because I'm wondering whether density or luxuriousness has the greatest effect on real estate prices. Knowing the answer to this would help to answer the question, "To solve the housing crisis, is it better to increase supply (even if it's luxury housing) or mandate affordable housing?"