Technically true. I think a "shortage" is technically defined in terms of price. But the example of housing is a hint at the limitations of this rule. Sure, we'd like houses to be cheaper, but most buyers don't have the option to just pay more. So what do we actually do about it? Increase supply, yeah, but why is the supply limited? Well, it's various weird, annoying restrictions on housing that you don't see unless you dig past "lol they want it cheap".
> Sure, we'd like houses to be cheaper
People that can't achieve home ownership right now want houses to be cheaper.
People that already got theirs don't. Yeah, supply is a problem but it's more than that. Housing cannot both be an investment and broadly affordable, those two goals are in conflict.
We need to change the way we treat housing so that it cannot be used to both store and generate wealth.
Yep, that's a good pointer to why those annoying restrictions survive.
>but most buyers don't have the option to just pay more.
You can argue the same for labor as well. Everything from off-shore competition to strained government budgets are excuses for why employers "don't have the option to just pay more".
Sure, some of those might be worth looking into. But also, we can be a lot more cavalier about saying a company that can't pay its workers should go out of business than we are about saying that a family that can't afford housing should just live on the street. I think the latter case is more worth attacking directly.
The point is, shortages being a price phenomenon is not all that actionable. You can't avoid digging in to the details.
We keep making the argument that supply is limited, ignoring corporate housing buyers, foreign investment (buying a house abroad might yield a visa), and people holding too much property. Limit these 3 and suddenly there's a lot more affordable housing on the market.