could you regulate the housing market using free market principles or is government regulation required ?

when i look at most consumer spending post 2008 it looks like it has actually started to contracting in comparison to economic growth.

(i.e electronics, travel , entertainment, restaurants small buinness etc) once you remove inflation and population growth the overall consumer trends decline per person in general people are spending less but at the same time salaries are going up and the catalyst seems to be a unregulated housing market taking more spare capital out of the market without the corresponding benefit to gdp that other avenues of investment offer example stocks/bonds suppling venture capital to companies to expand.

as were constantly building more houses then are actually required to support most first world housing markets the increased demand on construction materials and labour go up and so does the price of the housing. its not a housing shortages its an oversupply of rentals stalling the natural supply of housing to enter the market.

is there away to redirect the free capital away from houses and reduce the rental market without using strict government regulations. as it seems that without legal intervention in the way of house per person limits and laws to make multiple house landlord pay taxes to the point it forces them to put there houses back into the housing pool it seems like were due for debt bubblee that force a pricing reset every 10 to 15 years.