The market is not deciding when municipalities are legally prohibiting denser, lower-cost housing from being built.

To use your example, it's as if we were to restrict car production to mostly only Ferraris. And then if someone can't afford a Ferrari, we tell them to buy a Honda - but there aren't many of them to buy.

But there are reasons for municipalities to do that. Namely infrastructure. The city next to mine allowed uncontrolled building of housing and that city is a shitshow right now. The roads are clogged and often gridlocked. They deal with all kinds of failure modes in their utilities due to high usage. No.

My town is being more strategic about it. They allowed businesses to come in first and expanded out the robustness of the local coop's electric grid and only then did they allow appartments and they are doing them in stages to make sure the area can handle it. This is important in an area where not everyone is even hooked up to the city's water supply or has access to city sewage.

Sure, municipalities do need to consider infrastructure. I was just responding to someone saying that the market decides who can live in an area, which just isn't the full picture.

In areas where the power grid is struggling to keep up with demand, the municipality will need to plan with that in account. If you expand housing in an area where you've made driving the only transportation option, that will straightforwardly lead to more cars on the road. And so on.

But at least in my area, municipalities largely seem to be trying to keep housing density at or below the level it's at now, which is a problem when we're facing a housing shortage.