I think humans have demonstrated time and time again that densely constructed cities are a desirable place to live. Are there some people that would leave if these cities started loosening zoning and allowing dense construction? Sure - not everyone wants to live in a big city. But I would argue that the net change in population would still be massively positive.
Besides, why should existing homeowners get a monopoly on deciding what kind of city Santa Cruz should be? If there is a desire for dense housing, then dense housing will get filled. If you're right that people moving to these cities want suburbia then one would expect new multi-story apartments to go empty. But that's clearly not what happens.
Yes, they demonstrate a desire to move into these cities in their current non-hypergrowth form
Then you follow up and make that desire a reality by putting a down payment on a property
Talk is cheap