They do, it's called a municipal corporation, and it makes it decisions through voting.
Even better, you don't even need to be a homeowner to influence the decision of this corporation -- anyone living there is allowed to vote.
This cuts both ways -- people who 'didn't invest' also have a voice in property development, precisely through that same democratic process that you seem to consider so illegitimate.
> it's exercising naked political power to take property rights from people that bought them simply because they want to and they have the votes.
I mean -- if you really want to live in a free-market paradise, there are plenty of places that don't practice much zoning, like Houston. Anyone who buys real estate in the Bay Area ought to research exactly what the local laws in the area are first, and if they don't that's on them.