[wisty]

You're talking about "induced demand". Induced demand is not so high for housing. I might decide to drive 15 minutes to get a hotdog from Costco is the traffic isn't too awful. I probably won't buy an extra house just because it looks like a better deal than before. It does exist to some extent, but it's nowhere near as big a deal as for roads (at least in the short-medium term), at least I think that's the currently thinking on it - https://appam.confex.com/appam/2018/webprogram/Paper25811.ht...

[majormajor]

It's not induced demand through increased housing stock, it's city development that becomes a cycle of residential/commercial/business development (or all-in-one mixed development), all of which have feedback loops into each other.

Simply going for growth-at-all-costs gets you a more crowded but still expensive city. That may be better for the people running the cities and their budgets, but it's not clear to me it's better for anyone else than having things spread out to more places across the state or country.

[kelp]

Sprawl is probably worse for the environment overall. More driving, more land taken over. More density also reduces that.