Your first problem is that two and three families cost more per square foot to build than single family detached and they sell at a discount to single family detached. As you go up the chain, it gets even more expensive per square foot. Anything other than single family only makes sense when land gets really expensive, and/or when it is subsidized.
In desireable locations the land cost is often more than the construction cost, so splitting that land cost across multiple dwellings makes them more affordable. Sure the cost per sq ft is higher when you are putting in three dwellings under one roof than for a McMansion, but you are getting three dwellings that in aggregate should be worth more than one McMansion.
In most cities in the US, land costs are not going to be a large part of the costs of building new construction. Materials and labor will be most of it.
Your second problem is democracy.