I would've thought in an ideal world you would do things sufficiently well the first time so that you don't have to tear down the old work and redo it again. Not the opposite.

The ideal world upgrades incrementally.

You're saying it's better to get something wrong and fix it than to just do it right the first time?

I think he is saying, ideal world changes a little bit all the time, instead of tear down and redo.

I guess we're saying the same thing then, because my point wasn't that you'd never build anything new, but that your old stuff would remain just as useful and you wouldn't need to destroy any part of it.

I have to respectfully disagree. Tearing down and rebuilding is not a universal good, and I wish we were more careful about building well in the first place and preserving the history and context of the people who came before us. To me this means that the initial build was well-conceived and a good long term investment as that capital and labor expenditure has lasted a long time. Tearing down and rebuilding is wasteful.

Or maybe a cultural and societal win...

Property developers have to buy up the section of a block to demo(lish) and build something worthwhile. Many of the buildings are individually/family owned, with little incentive to change/think about change or some pride in passing the building down generationally. If you have an annuity (rents) sitting on top of appreciating land value and you're old or a son/daughter (usually living elsewhere collecting a rent cheque), why bother/how can you convince your neighbors to as well? That's why the section around Ainslie and Union I mentioned was able to be converted, they're all business/warehouses, a condo there now was in the 1940 picture an auto repair garage with the same footprint as the condo, but the house next to it still stands as is.

Is "demo" for "demolish" common usage?

EDIT: non-native speaker trying to improve my English by asking questions about English used in the wild; not trying to be judgemental

Very common in the US and Canada but probably not outside (updated my comment).

Common in New Zealand.

Not in the UK. I'd be very confused by that usage. "Demo" means "demonstration" or "demonstrate". Maybe builders might use it that way but I've not ever heard it.

My friends in the trades have used the word fairly regularly. I'd say yes.

Native-born bi-coastal boomer American here. Never heard this usage until my house was remodeled and the general contractor used it. I had to stop him and ask what he meant. (I didn’t feel too stupid since the vowels and syllable stress are different.)

This is an economic failure, but not a market failure. The failure is precisely because of rising land-use restrictions obstructing the market, especially in key centers of the economy, like New York, and especially since the 1960s:

https://eml.berkeley.edu//~moretti/growth.pdf