When each neighbor bought into the neighborhood, they all signed up for this same basic deal. Many of them would likely have chosen to not spend their money on the property had their neighbors not been bound by the same rules.

What is being proposed is a significant change to those rules that every owner at some point agreed to. This absolutely does affect everyone in the neighborhood because an older neighborhood is more than a collection of unrelated properties, it is a collection of actual homes of similar size and character with a particular feel and aesthetic.

A change to the rules may absolutely be necessary for the health of the city / population as a whole. Totally agree with this. Don't pretend though that it's not coming at the cost of infringing on the existing homeowners' reasonable expectations of what they bought into when they purchased their properties. Again, maybe it does need to happen, but homeowners are not unreasonable for wanting to keep their neighborhoods as they've always known and loved them.

From a contractual/legal perspective, sure.

From an emotional perspective though, it's different. Nobody buys a house on a whim, people spend a huge amount of time researching the best spot to buy based on all their preferences. To suddenly change all that is going to be distressing to any person who has ever bought a house.

Sure, because the law is changing, at least ostensibly due to the will of the people. The didn’t initially “agree to the rules,” and the new rules aren’t optional either. I’m obviously not so naive to think that all changes in law reflect the will of the people, but it’s pretty easy to see why this is likely the case, especially in these particular places that have enormous demand for housing and extreme restrictions on new housing developments (I bet that’s not a coincidence!).