(1) We're at buildout already (we're full).
I'm not entirely certain I had ever heard this argument prior to moving to New Hampshire, and that's actually kind of amazing. The year before I was born, my parents moved from Crown Hill, a city neighborhood north of Ballard in Seattle, to what was then unincorporated King County, now Shoreline. Shoreline had few vacant lots left when my parents moved in; nearly everyone like my parents who was leaving the city for a suburban home of their own in those years was moving to Lynnwood, a little further north and (I believe) an incorporated municipality at the time. My dad was working as a union electrician employed by an electrical contractor -- he helped build a lot of those houses, he did the wiring in the house I grew up in and he added a second floor to it. I believe he picked the guy who built our house, based on his experience with homebuilders in the area. My dad found a corner lot that was subdividable and bought part of it from the owner; we grew up next to the people who were willing to share their land with us (for a price). The kids were moved out, but the dad was an engineer at Boeing. I remember him helping me come up with a winning paper airplane for Field Day one year in school.
So I absolutely knew that a town could get to a point where it had few vacant lots, and where the vacant lots remaining for infill development had so many problems that it was really better not to try. As I grew up, I saw people put together quite amazing (and expensive) ways to build on those steep, landslide prone lots.
But the idea that "built out" meant "no more building" was just -- literally -- unthinkable. I knew about teardowns in Shoreline. I saw small lots get bought, combined, and bigger things be built on them. Etc. And Seattle proper provided further examples of same. "Built out" just means you have to remove something in order to build something new, and thus the new thing needs to make more money. In order to make more money, it usually has to be bigger, which usually means it has to be taller. Once it is bigger, either you have to find someone with a lot more money, or it has to be sold or rented to multiple people. Simple.
Move to New England, and meet the new form of "build out", where "build out" is an argument against further development. Bizarre. Unnatural. Very New England, tho. I'll probably be puzzling out how much of this is explained by decades long economic stagnation and how much of this explains decades long economic stagnation. And, in classic New England fashion, I won't take it particularly personally.
Most of the time.
(2) There's No Growth.
There are places in the United States that are not growing. In fact, some places are shrinking (Detroit. Detroit comes up a lot, now that I think about it.). Boston is growing. Greater Boston is growing. I _think_ Eastern Massachusetts is growing altho I'm less certain of that. So the "we're not growing" thing is really stupid, especially when people in Chelmsford and Westford try to say it. Then it's actually sort of embarrassing and cringe-inducing.
(3) We Should Rehab Not Build New
I read Jane Jacobs. I loved Jane Jacobs. Jane Jacobs had a big influence on me. But I'm not an idiot. Jane Jacobs said that the great thing about older buildings with smaller spaces is that they're crappier and therefore cheaper and they are cramped and therefore cheaper. Thus they are affordable to people who cannot afford nice, new and spacious. This had a lot of resonance when she was first writing about the Village, however, over time, it has stopped resonating about the Village, because the Village has been rehabbed into glossy preserved perfection and it ain't cheap any more.
_Arrival City_ actually does a fantastic job of explaining slums: the per square foot price to rent or buy in slums in arrival cities is higher than in much posher parts of town (or other towns). However, smaller spaces are available with fewer square feet, thus allowing people to get a place where otherwise they cannot. It's the classic "it's more expensive to be poor" conundrum, where you get a volume discount, whether it's on your house or your toilet paper. It _is_ more expensive to be poor, only you consume so much less that it's cheaper. Very difficult to remember this when you hit an amount of wealth that allows you to be price-insensitive on things like, say, toilet paper.
In an area that is _truly_ not growing, and even more so if the population is shrinking, rehabbing makes sense to provide decent, affordable housing. That's why you don't rip down Amsterdam, NY's enclosed mall; you keep it and move downtown into it, because you live in a place that suffers from Weather and enclosed malls are all about the absence of weather. But as long as the number of people living in an area increases, a rehab-not-build strategy in no way benefits the poor. If you build enough new stuff (and believe me, it'll take way more than you would readily believe), then the poor people can move into the newly vacated slightly less new stuff. But when a place is really growing (like inner ring suburbs with good schools are growing), crappy shit gets torn down and replaced with glistening, gargantuan, luxurious, er, shit.
All three of these arguments (we're full, there's no growth, we should fix up what we have) are pushed heavily by people who like low density (and perhaps are snobs, altho that is less clear) and do not want anyone in town to tear down low density and replace it with higher density. Not just not their neighbors. ANYONE in town. Not just not subsidized. ANYONE.
But the dumbest argument they put forward is this one: we'll never catch up to the 10% mandated affordable housing by building big complexes that are only 20% or 25% affordable. For one thing, they massively confuse two issues. Rental complexes almost always count in their entirety to the 10%, which means the 75-80% you think makes your situation worse really, really, really doesn't. But even if they didn't, a 20-25% affordable complex is a _lot_ of affordable housing compared to what the market is otherwise producing in your town (that is to say, NOTHING).
They must thing we're innumerate or something.