And yet, the problem isn't fixed, even after 20+ years of this "natural market solution".
Turns out, these people have to live somewhere, so now they travel from further out by car, causing a bunch of traffic congestion. They had to move, but the jobs are still in the same place.
If you have 20,000 people in the city, and 200,000 people outside
and you kick out the 20,000 people in the city, to another state
so 20,000 suburbans move into the city
now you have 20,000 people in the city, and 180,000 people outside
I'm not sure what you've solved. It feels like you're arguing this is a knee-jerk reaction, and a fair reaction, and that this is a solution, but you keep avoiding saying how it actually solves anything regarding overcrowding. Like it solves every problem except the one under discussion.
There has not been a "natural market solution" for housing for two reasons: strict zoning laws, and rent control. Both of those together have caused the housing shortage.
Turns out, these people have to live somewhere, so now they travel from further out by car, causing a bunch of traffic congestion. They had to move, but the jobs are still in the same place.