Since most people are willing to aim for a high quality of life, they look for a place with all the comforts needed. In this case, big cities provide different opportunities to make their life easier, but it is common for housing prices to rise in big cities. Why?
One explanation comes from the economic principle that people respond to incentives, discussed in Principles of Economics by N. Gregory Mankiw. An incentive is something that motivates individuals to act, such as the possibility of higher income or better services. In large cities, access to jobs, universities, healthcare, and infrastructure encourages more people to demand housing.
Let’s look at this from the famous Supply & Demand perspective. From the suppliers’ perspective, construction companies aim to maximize profit. According to the law of supply and demand, when demand for housing increases, prices and potential profits also rise, which should encourage more construction. However, in major cities, the amount of available land is limited and expensive, which restricts how quickly new housing can be built.
Another important factor is rapid population growth and urbanization. Even though construction is increasing in many regions, it is often not enough to meet the growing number of new families. In the short run, housing supply is relatively inelastic because building new apartments takes time and requires permits, land, and infrastructure. As a result, when demand rises quickly, prices increase more than the housing supply.
This situation can also be observed in Uzbekistan, where the number of newly constructed flats is still insufficient to fully meet the needs of a rapidly growing urban population (Gazeta.uz, 2026).
Gazeta.uz. (2026). Housing market and new construction in Uzbekistan.
https://www.gazeta.uz/oz/2026/02/04/houses/