The primary unit responsible for high housing prices in the United States is the government, specifically through its regulatory and fiscal policies. These policies, which include zoning laws, building codes, and tax incentives, have a significant impact on the supply and demand dynamics of the housing market.

Zoning laws, which dictate how land can be used, often restrict the development of new housing units in desirable locations. This scarcity of supply drives up prices. For instance, cities with strict zoning laws, such as San Francisco and New York, have some of the highest housing costs in the country. According to the National Association of Home Builders, in 2020, the median price of a new home in the U.S. was $328,900, but in San Francisco, it was a staggering $820,000.

Building codes also contribute to higher prices. These regulations require homes to meet certain standards for safety, energy efficiency, and accessibility, which can increase construction costs. The U.S. Census Bureau reports that the average cost to build a new home in 2020 was $289,415, but in some areas, these costs can be significantly higher due to stringent building codes.

Moreover, government tax incentives, such as the mortgage interest deduction, can also drive up housing prices. This deduction allows homeowners to deduct the interest they pay on their mortgages from their taxable income, making homeownership more affordable. However, this policy can lead to higher demand for housing, pushing prices up. According to the Tax Policy Center, the mortgage interest deduction cost the federal government approximately $100 billion in 2019.

Additionally, government policies related to affordable housing can exacerbate the issue. Subsidies and programs aimed at providing affordable housing can lead to bidding wars and higher prices in the surrounding areas. The Urban Institute found that in some cities, the introduction of affordable housing developments has led to a 10-20% increase in housing prices in the surrounding neighborhoods.

In conclusion, the government's role in regulating the housing market through zoning laws, building codes, tax incentives, and affordable housing policies is a significant factor contributing to high housing prices in the United States. These policies, while well-intentioned, can inadvertently create a market where demand outstrips supply, leading to increased prices.