Yeah, there are multiple issues that would need to be fixed.
Land value tax would offer a financial incentive not to waste space
Mandatory parking space laws currently force businesses to surround themselves with massive parking spots, so removing these laws would allow for more compact building
Zoning laws currently often prohibit mixed usage, thus making it impossible to have e.g. accommodation, shops and workplaces in walkable distances
The spread-out way of building stuff then causes public transport to become unviable, which in turn makes the car basically mandatory. This is a bit of a chicken-egg-problem since fixing it would require people to move into denser accommodation.
Land Value Tax would fix this
Removing mandatory parking spaces would also help.
Both of these are likely, and chances are one could lead to the other in at least one direction.
Yeah, there are multiple issues that would need to be fixed.