That claim is just false. No one needs to live at exactly 123 Acorn Street, Pierre, South Dakota, USA.
They may have good reasons to want to live there, including "My job is here", "My family is here", and "The only doctor in the world who can treat my exceptionally rare illness lives here". But God will not smite them if USPS starts delivering their mail to a different address. They have many options for figuring out a different place to live, either locally in Pierre, or farther away in a different state or continent.
The fact that the supply and demand curves seemingly move slower in the housing market compared to e.g. the electricity or food markets, which are arguably much more basic "infrastructure goods" (you can survive being homeless if you have food - you can't survive living in a mansion with nothing to eat), doesn't mean they stop being subject to the laws of supply and demand. At worst it means "Plan carefully, because if you miss the mark you will lose a lot of money for a long time." At best it means "Sweet - I wonder if I can make these markets more dynamic with a new company?"
That is true for consumer goods where demand can shift to substitutions easily
It is not true for infrastructure goods such as housing. (Housing is infrastructure)
There is a measurable need that can be under or over supplied.