It would increase those prices! But that would then incentivize additional production, which would drive prices back down close to each good’s cost of production (modulo the suppliers’ dominance and ability to demand margin).

So same mechanism applies to land, except then there’s no way to spur additional production of land, so the price just goes up.

Re density etc: correct, which is why I’m not arguing this benefits homeowners or building owners, except to the degree they are also landowners. A building owner who does not own the land underneath his building would not benefit much, the person who he pays land rent to will capture nearly all of the upside.