Like so much else in the U.S. economy, the housing industry is realizing that it pays to chase luxury these days. Even in a market that’s famously unaffordable, buyers looking for high-end finishes and communities with golf courses and pickleball courts are willing to pay up. At the entry level, price is the only differentiator. What is a savvy builder to do? Migrate toward the higher end of the market, of course.

That’s the scenario likely to play out as the fortunes of wealthy households and working-class Americans diverge in an economy where the stock market is booming, but the labor market is sluggish. The near-term implications are a slowdown in the construction of entry-level homes; hardly what’s needed to improve affordability. But what’s often missed is that, in the longer term, a

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