>> The raw construction cost of a housing unit in a dense building is cheap
Not true. The cost per foot of construction of a single family home is lower than that of a small apartment building. A small apartment building has a lower cost per square foot than a mid-rise apartment. And a mid-rise apartment building has a lower cost per square foot than a high-rise apartment building.
Taking only construction costs into account, when land is cheap, single family homes make the most financial sense, and dense housing doesn't make sense.
Well, except for manufactured homes. They have a lower construction cost per square foot than single family homes, but when most people talk about density they aren't talking about trailer parks.
That's why I specifically said that a per-unit cost is lower in cities. But units tend to become smaller and smaller over time.
> Taking only construction costs into account, when land is cheap, single family homes make the most financial sense, and dense housing doesn't make sense.
People in dense cities spend a larger percentage of their paycheck on housing than people in sparse cities ( https://smartasset.com/mortgage/housing-spending-2021 ).