you can look at seattle or vancouver for examples of property markets with massive expansion of available units with price appreciation comparable to san francisco

Not everywhere should be tear down and build up in all conditions.

How about the French quarter of New Orleans or historic districts of other cities?

This argument always shows up here and is idealistic bs.

Actually, an even stronger argument is that, well, cities need more than housing. You need city planning and zoning because huge buildings need commensurate transportation, sanitation and water/power supply infrastructure. But neither this, nor preserving hundred years old historically important districts, are what people complain when they complain about zoning. You can plan for more public infrastructure at the same time you allow lots of new construction. Hell, you can tax the developers of the new buildings to front most of the public infrastructure upgrade costs, then distribute the maintenance over the now expanded population. People complain when a city fails to do this for years even in the face of strong demand pressure, because the lower the supply the more the real state investments of existing owners appreciate in the short term.

There are a couple of ways this can fail as a result of various loopholes, but it is, in general, a good approach.

Further, you can offer developers tax credits for densifying infill development since more of the infrastructure is already in place.

Yeah, what a wonderful “local experience”.

The opposite effect happens in small/shrinking towns. Kids who grow up there and move out for a career can afford to buy a house where they grew up but don't want to. Should these people be forced to move back to their small town so they don't displace the "rightful" residents of the booming city?