I think it's entirely possible for a rule that seems plausible and fair to create bad outcomes, making it a bad rule. Saying that the people of a community may vote to decide to to allow anyone else in seems fair... until too many communities do it, leading to people not having anywhere affordable to live that is reasonably close to employment opportunities.
And it's a sort of collective coordination problem, too. People can move from city to city, and if a city decides to allow lots of new housing, they'll get lots of new people, which not only increases density, but also lowers rents in other cities by a little bit, while not lowering the rents/property prices in their own city by as much as they would if inter-city migration weren't a thing.
So when a city allows more housing, it benefits other cities. It's best if every city does this -- but because the incentives are a bit messed up, most cities in California have decided to "defect" and block construction. (There are other reasons -- people with the most free time to attend city council meetings and run for positions in local government are much more likely to be landowners or landlords, so they are over-represented, while renters are under-represented).
If every city and town builds a some more housing, you can get a much more drastic increase in affordability than if only some are shouldering all the burden, without massive changes to any one place. Which is why I think it makes sense to handle this at the state level.
And it's a sort of collective coordination problem, too. People can move from city to city, and if a city decides to allow lots of new housing, they'll get lots of new people, which not only increases density, but also lowers rents in other cities by a little bit, while not lowering the rents/property prices in their own city by as much as they would if inter-city migration weren't a thing.
So when a city allows more housing, it benefits other cities. It's best if every city does this -- but because the incentives are a bit messed up, most cities in California have decided to "defect" and block construction. (There are other reasons -- people with the most free time to attend city council meetings and run for positions in local government are much more likely to be landowners or landlords, so they are over-represented, while renters are under-represented).
If every city and town builds a some more housing, you can get a much more drastic increase in affordability than if only some are shouldering all the burden, without massive changes to any one place. Which is why I think it makes sense to handle this at the state level.