The city and county would prohibit them from building additions or in law units or additional rentable units unless they subscribe to a limit. It’s been suggested that it should be no more than 40% of original sq footage.(in one city’s instance)
Meanwhile, new developments are in 3000 sq ft lots and have 2400-2600 sq ft built area leading to property prices from 1 million to 2 million dollars.
This leads to more new housing at high value and hence high taxes. By restricting additions for growing families or multi generational units or multiple units that can be rented, people would have to purchase from new developments.
More taxes for the state(California in this case) and developers benefit. But the high density doesn’t make infrastructure better nor does it address issues like over crowded schools(and over worked teachers)...less open space and traffic grid locks and thinned essential services.
This is my observation about high density developments. I am fond of the notion that embraces the philosophy of the Dunbar Number. Have fixed density that is comfortable..perhaps multiple fixed densities and provide infrastructure accordingly. Once the density : infrastructure ratio has been satisfied, move on and develop adjacent by creating an chain link to the previous planned development.