The increased area used for housing is not only (probably not even mainly) due to increasing population but changes in household habits. More of us live alone and more single people live in whole houses rather than flats. There's been a general shift from towns and cities to villages and smaller towns, reversing the trends of the 20th century. Within towns, we're largely abandoning the late-20th century move to blocks of flats and returning to individual houses with gardens. Layouts are also demanding more road space. And drives and sometimes garages, of course, (which also increase flooding risk by expanding the area of impermeable asphalt). I'm not saying these changes in housing habits are necessarily bad – they obviously have good and bad aspects – but it's not as simple as more people = more houses.
The problem is that until now the equation
has been "more people = more houses". I agree that in the longer term this is no longer sustainable and other countries provide a selection of ways forward that might be suitable. France still builds lots of individual houses in the suburbs, but it is a much larger country with a smaller population and as it's on balance a bit warmer farmland is a bit more productive. Germany has similar issues to us and there, at least in and close to towns, blocks of several flats are built. Typically there are six, eight or ten to a block - each flat is as large in floor space as a normal suburban house and almost all have large(ish) balconies and lifts serve the upper floors. Clearly these flats come in different sizes and all are defined by floor area. In more modern buildings the sound-proofing between the flats is excellent. The buildings all have cellars for storage and for housing the communal kit for heating and utilities: water, sometimes gas, telephone terminations, TV distribution, etc. The cellars sometimes include a communal laundry, ventilated drying rooms for clothes to avoid condensation in the flats, and always a car park with spaces for all the flats.
This latter has the advantage that the buildings can be more closely packed as parking space is not required, the cars are protected from the winter snow and the streetscape is unencumbered with vehicles. The legal position is that, roughly, the structure is owned by a co-operative the owners of which are the inhabitants of the flats. There are all sorts of safeguards to avoid the case where one owner doesn't want to pay for his/her share of repairs or improvements - but there is of course always room for disagreement but these are not very common.
The point is that flats of this type are perfectly suitable for families with children and the building packing density is higher than the typical
UK▸ suburban development. The downside is that the gardens are communal - although may people have a garden in a sort of 'garden colony' elsewhere. Imagine lots of suburban gardens with hedges but no houses - except for a wooden garden house.
It might not be entirely suitable for all comers - there are still people with individual houses in Germany - but in towns the concept works well.