Because even densifyig redevelopment usually does that, and not accidentally.
> They don't realize that by opposing development they're actually restricting supply, and thus increasing prices.
The people concerned about displacement have a preference for their current location that exceeds the cost savings they might realize by being displaced by a new development, even if that development drove down average prices in the broader area by upply side effects (which it might not; because new development can attract new people, induced demand can prevent local price reductions.)