It's not like the newly built homes are typically the most affordable. It causes a ripple effect as those that can afford it upgrade their housing.
https://research.upjohn.org/cgi/viewcontent.cgi?article=1314...
https://research.upjohn.org/cgi/viewcontent.cgi?article=1314...
You're right: The cost of new construction anchors the used market. Used housing is so expensive because new housing is even more expensive. If new houses were cheaper I, like many others, would have already have built one and my current home would be up for grabs at a lower price than I'd expect in the current reality. However, that's repeating what was already said.