Thats because your neighbours probably won’t like you opening a rooming house in their residential neighborhood without some kind of consultation with them on the zoning and appropriateness of such a thing.

I’ve seen houses where every room (including the living room) is occupied by a foreign student and the ‘landlord’ is running a slum rooming house. Thats what you’re not supposed to be able to do without getting approval. It impacts you negatively to avoid impacting your neighbours without consulting with them.