Tracking the number of tenants in each building is an enforcement nightmare once you add a financial incentive to misrepresent it.<p>Just add a low density housing tax. Wait, don&#x27;t call it that - call it a land-use tax adjustment. Measure ability-to-house-people as some combination of square footage of habitable area, bedrooms, bathrooms, and number of rental units. Divide by the lot size. Multiply by a large enough negative number to incentivize building, then add a constant to make it revenue-neutral instead of a subsidy.<p>This would effectively subsidize people who build higher-density housing at the expense of people who own parking lots or commercial real-estate. It&#x27;s a little troubling to tax commercial development or offices, but it&#x27;s already much easier to get approval to build jobs, so cooling that down a bit shouldn&#x27;t be a huge issue. Besides, you can dodge the tax with mixed-use buildings, which is generally something that you want for efficient land use.<p>Land-value would be a better way of assessing the multiplier, but that&#x27;s not constitutional for California to enact because of Proposition 13. So, it&#x27;s back to a square-footage with a housing capacity offset.