Based on things I read, Nick, and I read a lot, your main thesis makes sense if the referent is highly populated areas. But limiting yourself to that lens means that you do not see the story in a broad swath of rural and semi-rural America. (I live in Northern Michigan.) There are jobs, but few of them pay enough to afford to live close to work. The very factors you mention — zoning laws, regulation, and delays — make it unprofitable to build 1,000 square foot homes. There is a very real shortage of housing suitable for the average employee in those regions. And every city, Chamber of Commerce, or similar organization sees improving housing for the “working class” as a major obstacle to local progress.