Let's take a theoretical city of 100k residents and an average number of residents per housing unit of 2.
There is a need for 50k housing units (condos, homes, apartments) in that city to house all residents.
Let us imagine that in this city there are 2.5 million housing units yielding a 98% vacancy rate.
Of course there are some locations which are more desirable - water views, great schools and nearby parks, upscale shopping, restaurants, and medical facilities. Those are priced higher but given the high vacancy rate, those with a limited housing budget have ample cheap options.
Now a group of developers decide they want to build another 10 million housing units on the outskirts of this city with 100k residents which already has 50 times more housing capacity than it really needs. These new locations will be a longer commute to work, are further from shopping and parks and restaurants. Yet the developers in some cases have priced their units higher than some of the more desirable existing locations.
What will happen?