My theory: your primary residence should not be viewed as an investment, because you've got to live somewhere; if you sell it and cash out you need to turn around and find housing in what is a hot market, or move into a van down by the river. However, Millions of older, reliable voters own their home and it's the primary store of much of their wealth. Any government that impacts this will be out on the street asap. So your house is likely a good investment, but you can't think of it like other shorter-term, liquid investments.
This conundrum of generations having much of their wealth stored in their home is part of the real problem around housing in general. This is why we decided to rent out our properties after evaluating our situation and understanding that it made more sense to generate consistent profits off real estate in the form of rental income than incur all the liabilities of simply buying and living in one.
I personally think it should be one or the other - you either are buying real estate as an investment vehicle (to flip, rent, speculatively build etc) or buying it to live in, but in which point you don't treat it as a primary store of wealth - but unfortunately home ownership in the US is structured that if you buy and live in a home, you inevitably end up with it being treated as both a store of wealth and a home in which you live, and you're constantly tugging between the two things which have very different considerations.
I think a land value tax and liberal zoning laws would go a long way to fixing some of this, but is another discussion entirely
