You got it all wrong. Higher costs is exactly what makes higher density development possible. They give incentive for developers to build denser and may even force them to build denser. If a condo is that expensive, can you imagine how expensive a single family house would be at the same location? Single-family houses are usually only built on cheap land on the outskirts the GTA and expensive land sees high density developments.
The increased land values is why the greenbelt increased the density of developments. And look what happened in Mississauga after it became built out: property values skyrocketed (by 30-50%) and suddenly all these condo towers started being built. It is not a coincidence. Why do you think there are so many high-rises being built in downtown Toronto?
If a single family home were built in the same place as a high rise or even a mid rise would be built, it would probably be much more expensive than in the suburbs, that's true. But if developers are encouraged to develop because they can sell $300 k closets, it doesn't work as well in the long run.
Basically, it caters to a specific group of people. Families and people with a lower income won't buy into it (or god forbid low-income families,) because the price for the high density home they want to live in is enormous when taking into account their needs and available money. Even if you want to fit a family of four into a one or two bedroom condo, that same family could instead buy a place twice the size in the suburbs for the same price. But if you give them a choice between high priced condos and a dwindling supply of houses, they're not going to choose the condos; they're just going to leave. They're either going to go to places where condo living is easier and less expensive, or to places where there are more available suburban houses.
That's why the government needs to find ways to make condos and high density living more affordable to the average person, and there's a number of ways they can do that. They could offer tax breaks to developers, so they can start lowering prices on condos. They could have funds to give to developers wishing to build high density, again giving them extra money to lower their prices.
Once they get enough people in condos, there's going to be a tipping point that'll be reached. There's going to be more demand for them, and they'll start being more than just the places where rich or single people live. Demand will rise, and developers will be able to build more and sell them at a lower price due to this increased demand. Due to this lower price, families will be able to live in high density more easily, and when that starts happening, the masses will be rolling in. You'll have places that (self-sustainably) are competitive in price with 'burb living, as well as having more convenient connections than living in the suburbs. Some people will chose the conventional suburban life, while others will chose the high-density life. This is what I love about all the City Centres, because they will not only be a place for areas to focus on, but they will keep a suburban feel while keeping the good characteristics of cities.
If you want to know why so many high-rises are being built downtown, it's because that's where there's a concentration of unmarried young people, or at least people without children and demanding little space. They have a niche downtown, where they can buy condos suiting their needs, and developers develop based on their needs. But what I see wrong is that developers are trying to carry that into the suburbs. For the most part, they advertise a grand bachelor lifestyle, with really little attempt to coerce families into living there. And that's all because it's currently how they make money. Don't get me wrong, I can live with downtown condos being relatively expensive (though the price could go down a bit.) What I'm worried about is the relatively suburban condos (especially those in NYCC, STC, MTC, RHC, VCC, ETC,) being expensive and only accommodating growth in this current niche that condos fill.
So... I think that made sense.
