This is fine for new construction. Building more at the high end puts downward pressure on prices in the middle, which in turn puts downward pressure on prices

This is fine for new construction. Building more at the high end puts downward pressure on prices in the middle, which in turn puts downward pressure on prices in the affordable housing space. This is called "filtering" and it's been shown to work. A relevant quote from City Observatory summarizing research and implications: But very little private housing in the United States was originally built for low-income people. Instead, homes built for the middle or even upper classes gradually became cheaper as they aged, as people with high purchasing power moved into trendier, more modern homes in “better” neighborhoods. As higher income households move on, the now somewhat older homes or apartments they formerly occupied are sold or rented to people with more modest incomes. This process is called “filtering.” While the evidence that filtering is a real phenomenon has been around for a long time—the core of nearly every American city contains neighborhoods with once-luxurious homes now occupied by people of modest incomes—the first study to provide a rigorous measure of how it happens was published only in 2013. In it, Stuart Rosenthal of Syracuse University uses nearly 40 years of data from the American Housing Survey to figure out the average pace of filtering across the country, and what makes housing filter more quickly in some places than others. [1] [1] http://cityobservatory.org/what-filtering-can-and-cant-do/ http://cityobservatory.org/what-filtering-can-and-cant-do/