If this type of housing is considered just fine for college students, why should it be illegal to provide for people once they graduate? I get that not everyon

If this type of housing is considered just fine for college students, why should it be illegal to provide for people once they graduate? I get that not everyone would want to live this way their whole lives, but part of the issue with the US housing market is that there are no entry-level housing options. This makes housing not just expensive for young people or poor, but drives housing prices up across the entire inventory. Most quality of life improvements, especially in urban areas, have been driven by efficiencies and economies of scale.