Then welcome to urban sprawl.
By over-regulating the number of housing units in a given city, you force builders to build homes farther and farther out into the countryside, where magically the sewers and water supply issues vanish (???); Where lot sizes are often required to meet certain minimum sizes which is a waste of precious land; you encourage longer commutes; businesses are forced to relocate to where their customers live; the tax base of the "impovershed" inner city supposedly goes down even as the price of inner city real estate goes through the roof; Commuters waste more fuel and time driving between work and home; And we raise a new generation of latch-key children.