[matthewowen]

Yes, but some people would prefer to have an apartment and save some money, and that would overall create less demand for the available homes.

End result: people who want apartments get them, people who want houses still get them and pay less for them too.

[zaroth]

That's not how it works. Anyone in the market for an apartment isn't driving up demand for this $2.4m $1,200/s.f. house.