Yep. Monopoly is probably the classic example of a game being destroyed by bad house rules.
Even so, I'm not convinced Monopoly using the rules as written actually works terribly well - my Grandmother has a strategy of buying up "one of everything", and then steadfastly refusing to let go of anything, ever. This can very easily lead to the game getting 'locked', such that nobody can complete a set, nobody can ever build any houses, and so you can never move to the endgame.
This is an extremely common outcome in Monopoly.
Richard Garfield wrote a very good article for Dragon or Scry (don't remember which) where he talked about fundamentals of multiplayer game design and one thing he talked about is that many multiplayer games boil down to the following mechanic:
1) Give every player 5 chits.
2) Each player distributes thier chits to all the other players.
3) The player with the most chits wins.
The difficulty in a multiplayer game is that most of them on some level end up being popularity contests and victory is forged at some level almost entirely in the metagame, because the collective resources of the other players can usually if not determine the winner then at least determine who the winner won't be.
Monopoly frequently ends up in exactly that state, where the winner is basically determined by popularity. Even if the game doesn't deadlock, it frequently ends up in a situation where, if one player is the only player to have a set, then two other players will agree to a trade knowing that the trade favor one party more than the other (either because one player gets the far better property or a two for one, or else because the one player has a cash on hand advantage that can be exploited to more readily improve the property). This effectively ends up deciding that the leading player doesn't win in favor of the player getting the better deal in the trade. From there, the game turns into the Garfield game described above.
And prior to getting into that state, it's almost entirely a game of random chance.
Incidently, Risk, in addition to its other many faults, boils down to almost the exact same dynamics when played by good players.
