This is akin to burning down a whole apartment block to smoke out a petty thief in it.
The people who are holding the housing market hostage have many many millions due to all of their hoarding, you are going to choke every single roleplayer that owns a home until the literal 1% caves in.
Property hoarding should be dealt with an iron fist. Start going down house by house, see which character owns them, what they have done with the place, how active they are and if their character is up to snuff. If they're not? Expropriate it and make the house leasable. I know this'll put a