Your first two sentences directly contradict each other. There is in fact a lot of market demand for non-fully-detached-single-family-housing that the market is

Your first two sentences directly contradict each other. There is in fact a lot of market demand for non-fully-detached-single-family-housing that the market is not allowed to satisfy solely because of the zoning legislation. If you actually let the market decide then you will see more density (and cheaper housing options on the lower end).