It's like roads. Private builders enter into agreements all the time to enter into deals with local governments where they'll expand roads or whatever right around where they're developing. If you get lucky you'll have a contiguous string of adjacent developers and you'll end up with a nice road for a few miles. If you're unlucky, you'll end up with 4 lane divided road-farm road-4 lane divided road-farm road, off and on for miles and miles and it's pretty much the worst.
Private developers don't have incentive to build a national highway system, they'll just build whatever is the minimum necessary that figures into their profit model.
Private developers will build whatever people want, which sometimes is completely unlike what people need. Sometime back, there was a recently built over-55 community discussed here. It looked just like your generic subdivision. One wonders how much misery will be there 20 years from now. Wide roads without sidewalks are not good for people with low mobility and vision problems, and there is no adequate hospital and nursing services around, not even a food store within close distance. The future in that development will be fun to watch.
> Private developers will build whatever people want
I think maybe a better way to think of it is that developers will build whatever makes them money -- a good enough proxy for wants in many cases, but not for all.
Private developers don't have incentive to build a national highway system, they'll just build whatever is the minimum necessary that figures into their profit model.