I feel like this works for housing but not really for land? As density increases the cost of housing should go down (more houses), but the cost of land would go

I feel like this works for housing but not really for land? As density increases the cost of housing should go down (more houses), but the cost of land would go up (ability to build more houses on the same plot). I’m imagining the house from Up in the middle of manhattan; you could never build enough housing to make that a bad investment.