You have received three good, on track answers.
As to "who benefits?" As long as they were selling, the economy benefitted, and that spilled over into what other goods and services builders and their workmen could buy, ..and bankers ...and realtors ...and the utility company employees, and .......! And don't forget the tax bill that was paid by all those transfer taxes.(And yes there has been far too much fraud and greedy in the mix as well.)
It is a much more complicated picture than just one sectors' over-build or greed, or lack of restraint, however. (Isn't it always??). I'm afraid there is more than enough blame to go around for the escalating expense of housing.
(What follows is a bit of preaching, so maybe you want to log off now and go read something else.)
Can you remember back 3 years? Go back and read the headlines, and the articles that followed, from 2004 and 2005. There was a 'hurry and don't be left behind in getting your piece of the American dream' fervency in the air. What we collectively chose to forget was that there has been a lot of hard work and sound financial principles that have in the past, and still need to, accompany that growth. In my humble opinion, we are now (Collectively) suffering for our (COLLECTIVE) lack of restraint and discipline.
Just like an out of shape, overweight, stress loaded patient that has gotten a wakeup call from a nasty heart attack, we have a choice. Are we willling to (COLLECTIVELY) knuckle down and pay up and get back to basics? If we are we have a good chance of learning a valuable lesson from our mistakes and start growing healthy financially again.
Just a thought, Thanks for listening.