Your premise is right of course. But Isn’t the primary issue for RE that there are highly vested interests keeping supply restricted? I think it’s unfair to focus exclusively on the bystanders “voting against their interests” with their poor frameworking.

The family who bought a fancy house in a construction restricted suburb (with perhaps limited physical capacity in its local schools) is a reasonable NIMBY protecting their investment. The rent-controlled apartment renter doesn’t care about average rents declining in NYC, they want to keep their cheap apartment!