[jjav]

> only maybe that there is some curve where building more doesn't result in increased demand

In theory sure, if the supply approaches infinity then at some point an additional housing unit has zero value. But these are houses, which in practice are expensive to build so supply will never approach infinity.

Can you name at least one US city where housing used to be expensive and they built so much that it resulted in excess supply and a consequence it is now cheap to live there (and the city continues to thrive - not talking about bankrupt ghost towns)?

As far as I know (but curious to see if I'm wrong) there isn't any case where that point in the curve has been crossed.

The densest area in the country is Manhattan, not known for cheap housing. So if even the densest housing area has not crossed that point in the curve, it's an argument that maybe it's just not possible to do so in practice.