Inadequate infrastructure and availability of water are often contributing factors.

To build homes, including multifamily homes (by which I believe you mean apartment buildings and the unfortunately named "town homes"), one needs to have adequate supporting utilities, including sewer and water, and other social supports. Invite families into your communities, and you will need more roads and maybe sidewalks, more or larger schools, more police, more firefighters, larger medical facilities.... All those things have to happen or be planned up-front, before the homes are occupied, so the current taxpayers must foot the bill, as a kind of investment in the future taxbase of their community, not to mention their own real estate values.

Ask the questions. Then ask how much in new taxes it will cost to build or refurbish to fill the needs of the new families. Then ask whether your neighbors, and you yourself, will want to underwrite that.

On whose fault it is for the defaults, offhand I think it's our general inability to understand interest rates and payment on capital vs. payment on interest. If you have a mortgage you can -ahem- afford with a small downpayment, but the mortgage has an adjustable rate &/or the monthly payment doesn't touch the principle (which is what many of the homeowning defaulters have, due to their own inability to analyze the agreement), when the interest rates go up you will lose your house because your payment will suddenly inflate to an unaffordable sum. Bingo! The bank that bought your mortgage from the bank who bought it from the bank you got it from will own "your" house, and you will have nothing because you never put a cent toward the actual cost of the property. You thought you bought a house, but it turned out to be a house of cards.