I think this cuts to the crux of the issue.
This started with the issue that SF artificially lowered its density from being in competition for the most dense major city to just being the second-most dense by a healthy margin.
But in truth, being that dense hasn't been a slave. So now we're moving out, saying "If only San Jose or Oakland were more dense, THAT'S the magic bullet," as if being like NYC isn't both a rarity and a massive undertaking/accident of history. And our comparison point is ... the NYC metro, where affordable housing is also a nightmare.
I'm not saying you're wrong that more housing should in theory lower that price point. You're right. But when it all works out, density on its own doesn't seem to correlate with affordable housing, and it's worth keeping that in mind when we want start imagining semi-unfeasible things like getting Santa Rosa to be more like Queens. It's all a great theory, but the same kind of market theory holds that forces shouldn't produce real estate prices like this to begin with.
(I also wonder about what I'd call untapped demand. I remember reading The Power Broker, in part about the development of NYC. And they ran into an issue of early traffic problems. The answer, much like our density think, is to build more roads, bridges and tunnels. And it turned out that every new pathway they built gave more folks the bright idea to drive, so each bridge in turn was overwhelmed and we have the joy of modern NYC traffic. Whatever bubble is out there isn't deterred by paying $1,300 per square foot)
Yeah, and I didn't intend to unfairly single out SF. I find it to be one of the more egregious when it comes to fighting density, but my overarching point was that EVERYWHERE fights density. The NYC metro mostly was built before anyone figured out to fight it, but the rest of the nation didn't.
There are also confounding variables here. One of the things that density does is attract more people, via network effects. Metro areas have more jobs--and more ability to change jobs within your industry--than rural areas where one employer might be dominant. Metro areas have more cultural enrichment available, more variety of restaurants, more opportunities for activities, etc, because of the higher density. If you've got a passion for underwater basket-weaving, it's a lot more likely that you'll find fellow underwater basket-weaving enthusiasts in a metro area than in an rural area.
That's a natural phenomenon. Why did Silicon Valley become such a hotbed of tech? Because back in the 70s and 80s, it was the up and coming tech location. And then it attracted tech people from all over the country, so it became even more of a hotbed of tech. It was a positive feedback loop due to the network effects.
So cities are naturally going to be more expensive than rural areas. Because more people want to live there, and it seems that the bigger they get, the MORE that people want to live there. That will naturally make cities expensive.
But density will at the very least help.
