Comment by bombcar

Usually it means that supply gets bought up and converted (and leaves the supply, often).

The desire is that a row of single family homes (say a block has 10) get slowly redeveloped into a row of brownstones or similar density - but they're still single family and owned by the residents, but now you have 20 in the same space, or 30. You can triple the density and not really change anything else.

But what ends up happening is that the single family homes remain single family, get slowly bought up by a developer and rented, and then the entire block gets turned into an apartment complex, perhaps with the same or even more units, but they're all rentals forever.

This might be fine, and perhaps even encouraged in some areas, but it does reduce the supply of homes to buy.