I live in a middle-sized city in Germany that is also struggling with a housing shortage and rising rents (though not anything like San Francisco). This particu

I live in a middle-sized city in Germany that is also struggling with a housing shortage and rising rents (though not anything like San Francisco). This particular city is somewhat unique in that it is rather sprawling (for Germany) with a lot of low-rise buildings and single family homes. The first solution to the problem was to build houses behind houses behind houses and to build on (formerly generous) back gardens. Now, with land values so high, much of the older housing stock (old enough to be inefficient but too young to be protected by historic preservation laws) is being torn down and replaced by small, low-rise blocks of flats. This has its own problems (small unit sizes are family unfriendly, for example), but it is slowly easing the supply of housing without significant geographical expansion of the city. I bring this up because this strategy is exactly what is being discussed in a number of US cities. New construction in Germany is highly regulated, but the rules themselves do not produce the sort of socially and economically homogeneous residential enclaves you often see in the US, nor do they result in a strict separation of residential and commercial districts (shops of all kinds are often mixed into residential areas or have flats on top). In short, there are no ghettos, most residential areas are very mixed in terms of income and property types, and businesses and basic services are always readily accessible on foot or with a bike (you don't see those typically American situations where, due to terrible urban planning and strict zoning, one has to drive 3 miles to travel 150 yards from a home to a supermarket or some other destination). I think there must be some middle path whereby local stakeholders and municipal officials can regulate urban land use without arbitrarily dividing a city into self-contained, homogeneous zones.