The vast majority of "luxury" properties are just regular property that spend a marginal amount on nicer appliances and finishing.

No matter, it comes down to what people will pay for. At the very least they're selling/renting to people with more wealth.

Yes, new builds are targeting wealthier people. Those wealthy people then move out of their previous housing and that becomes the affordable housing. Like another commenter pointed out, you can't get affordable used cars without producing new cars.