They choose A 100% of the time. No landlord has the ability to affect the market by purely limiting their own development. The market vacancy rate, which is the strongest, almost singular factor in housing prices, doesn't give a shit if you build 400 apartments or 20, it won't budge an inch. Only collective growth by the entire housing industry has the capability of budging vacancy rates.
For an example, Greystar properties, the largest multifamily housing provider in the Seattle market, controls less than 1% of the multifamily housing stock. If they wanted to decrease the vacancy rate of Seattle enough to push prices up by 10%, they would have to exit the market completely.
If you can't affect the market, because it is too competitive, your only recourse to increase profits is to build more. The force propping prices up is government and government alone. Nobody is voluntarily limiting their own development in order to push prices up.
For an example, Greystar properties, the largest multifamily housing provider in the Seattle market, controls less than 1% of the multifamily housing stock. If they wanted to decrease the vacancy rate of Seattle enough to push prices up by 10%, they would have to exit the market completely.
If you can't affect the market, because it is too competitive, your only recourse to increase profits is to build more. The force propping prices up is government and government alone. Nobody is voluntarily limiting their own development in order to push prices up.