If you mentioned china, then we should look at China’s massive building of housing there for inspiration? They have none of the restrictions you say is keeping us back, but because housing is a speculative asset (and the only generic one of value given a untrusted stock market), prices still go up, people cant get places to rent in Beijing or Shanghai, one bedroom apartments going for $1 million, etc… of course, the issue is the speculation, not the lack of supply.

We already rely on market forces to ensure that everyone doesn’t just move to one of a few popular cities. We don’t just need more housing, we need them specifically in Seattle, SF, LA, Denver, Manhattan places where people want to live. I still don’t see how SF achieving Manhattan density would cause its prices not to be Manhattan comparable. Something else is going on with increased supply having the ability to induce even more demand.

Overbuilding is also a danger. Berlin had excess capacity of housing and work space for a couple of decades before demand could fill it. Just because there is demand today doesn’t mean there will be demand when your project is finished, eg interest rate increases can put a damper on speculative demand. A Japanese style mega property crash is something no one wants to deal with.