Would be cheaper and more conducive to families to establish new businesses outside of those costly regions and spread the population out. Density comes with its own set of problems. Jane st. in Toronto comes to mind. Families need places to walk run and play that are safe and density removes much of that safety factor.My only point of contention with this is the notion that housing supply needs to grow in low cost areas.
Those low cost areas have a low cost because there isn't a job market there to support a large enough population to make it expensive. A bunch of "cheap" houses in Timmons doesn't help when people can't get jobs to pay for those houses.
Density is the solution for our cities. More density, in units designed to appeal to young professionals and small families.