Well, NIMBYs killed microhousing in Seattle which was going to be the kinds of small, affordable apartments that people could actually afford to live in.

Yeah, that’s one of the problems with the whole “but that isn’t REAL Capitalism!  We need to deregulate!” things.  The regulatory capture that corrupted the existing process will also corrupt its dismantling unless you fix it, and Capitalism pays people to subvert public ownership of the state.