There's a degree of purpose to artificial scarcity though. If construction is completely unchecked, then the demand, and load on infrastructure can reach a point where it becomes unusable to everyone,old and new residents.
I've lived in Toronto for a long time, and after pockets of th city got rezoned and high-rise construction was allowed, it created a situation where it was not possible to get onto public transit during peak hours, and people resorted to walking to work for 45 min instead of their planned 15 min commute when they brought their condos pre-construction. Similarly the growth of immediate Toronto suburbs has been so immense, that it is not possible to get a seat on the subway if you don't board at the terminus station (as suburbanites fill them). The city is addressing these problems through transit expansion, but it is taking decades for each project to complete (example https://en.m.wikipedia.org/wiki/Line_5_Eglinton).
The main point is, zoning in a vacuum is not evil, or if more palatable, a necessary evil.
Not just surrounding cities - to your point, above them. All those single family neighborhoods. All those new buildings built to 6 stories instead of 60.
In Seattle, basically every building built is built to the maximum zoning allows. And it’s all arbitrary - purely about the whims of the local homeowners.
My parents moved to Charlotte, NC in 1999. It amazes me the sheer growth in HOUSING in city center. There are several new buildings well beyond 6 stories. There are even more new buildings in the 3-8 range in areas like South End. There are even more single family homes further out of the city.
It may not be perfect, but it's seriously beautiful and developed nicely in the last 20 years.
It can't be understated what a huge impact the Lynx Blue Line (light rail) had on Charlotte's ability to shape and concentrate their growth in the past 15-20 years. Developers started planning and building around it well before it opened. Strong transit can make a huge impact on affordability, especially if it frees families up from the burden of car ownership (expensive depreciating assets with large operating costs).
The demand driven forcing is miniscule compared to artificial scarcity due to zoning permits or bad infrastructure. (Typically slow transportation.)