The market sets rent within the parameters it is given. Maybe an entrepreneur could build taller buildings with cheaper per-unit prices, but zoning regulations

The market sets rent within the parameters it is given. Maybe an entrepreneur could build taller buildings with cheaper per-unit prices, but zoning regulations cap building height. In that way, the market isn't really setting the absolute price. On top of that, many localities literally overrule market prices with various forms of price fixing, affordable housing mandates, etc. Would it be an open market if we only removed one regulation, height restrictions? Nope. But to blame capitalism when other major forces are at play is not a full assessment of the situation.