Something is about to happen in Margaret Atwood's backyard. Or, more precisely, her neighbours' backyards. It is a condo: an eight-storey luxury building at 321 Davenport Rd. And she is not pleased. On Monday night, she conducted an hours-long battle on Twitter with a group of millennial urbanists (and me) over the eight-storey building proposal, talking about "violating bylaws and killing folks' trees."

In other words, she performed the hackneyed role of exercised NIMBY.

During her tirade, it was distressing to see someone with such fine antennae seem so out-of-touch. But it was no surprise: In Toronto and other desirable cities, older progressives frequently stand in the way of new development. These advocates use the word "character" a lot. Ms. Atwood lives with her husband, Graeme Gibson, on the very handsome Admiral Road; Mr. Gibson wrote to city officials that the new development "hover[s] close to a brutal and arrogant assault on a community that has been here since the 19th Century."

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Gee: Toronto's young people are starting to interrupt the not-in-my-backyard chorus

Related: Jennifer Keesmaat, Toronto's outspoken chief city planner, resigns

Their moral outrage has been marinating for decades. These people settled in downtown neighbourhoods in the 1960s and 70s, when the Annex was cheap and writers could afford it. In those days, developers were cast – sometimes fairly – as rapacious capitalists out to tear down houses, evict working-class people, and build towers that were "soulless." One of my favourite photographs of this period shows a group of protesters with a sign that reads: "NUTS TO HI-RISE LIVING."

But if the old progressive stand has not changed, the situation today has turned topsy-turvy. The low-rent hippie days turned out to be a historical blip. For 20 years now, North America's city centres have been in high demand. Ms. Atwood's neighbours include a Weston and an Eaton. Across the city, the need for new housing is massive and unquestionable and, while governments sit back, the market is left to deliver. City planners predict Toronto will have added 700,000 people between 2011 and 2041, an increase of about 25 per cent. That is change on an enormous scale; and most of those people's new homes will be "infill" – added to existing neighbourhoods. They will be in somebody's backyard.

Such as the project on Davenport Road, which would include 16 luxury apartments in an eight-storey building. Ms. Atwood has protested that she, personally, is not opposing the development – only its impact on neighbours' trees and the fact that it would come too close to their lot lines and houses, and so on.

But it's always something. Whenever affluent neighbours oppose a development, they cite problems with sunlight, or privacy, or traffic – and somehow, the city planner, despite paying attention to such things, is never being sensitive enough. And if you dismiss those concerns, as the writer Shawn Micallef did on Twitter? You must be working for the developers.

Negotiating this fracas is especially hard in Toronto, where the parking lots are disappearing and developers are turning to leftover scraps of land such as the Davenport site. (The project is proposed by the Alterra Developments and the design is by the architects Giannone Petricone Associates. It promises to be beautiful. That should matter.)

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Developers cannot build much of anything across most of the city's land area, which is occupied by single-family houses; at most, it is possible to build a triplex. The urban planner Gil Meslin has coined the term "the Yellowbelt" for this vast swath of single-family homes, a huge barrier to new housing.

This barrier is entirely political. The 1960s generation of planners, activists and politicians locked down these areas to protect them. Similar regimes are in place in other North American cities, including Vancouver and San Francisco, Calif., – each of which have absurdly high housing prices.

That is no coincidence. If you constrain the supply of a commodity, it gets expensive. Yet, this practice continues, because homeowners hold all the political cards. Never mind the needs of younger or less privileged city-dwellers, or those who want to move in; any new development has to be endlessly measured for "impacts" on those who already live there.

Even where you are encouraged to put a condo in Toronto, the planning system is maddeningly ambiguous. The city favours mid-rise developments on major streets, so-called avenues; this is a way of cramming new housing into old areas without touching the venerable houses. Davenport Road is being rebuilt in this pattern. And while the city's official plan, its vision document, favours putting new residents in the downtown area, its zoning bylaw – which regulates specific sites – is decades out of date. The Davenport Road site is zoned for, essentially, a two-storey building. That means anything over two storeys can be approved, but only with scrutiny.

Here is one reason Ms. Atwood and Mr. Gibson can be so angry about an eight-storey building: They think it "violates" the rules, even though it, in almost every respect, follows the spirit and the details of city planners' vision.

Your view on all this is likely to be generational. I'm in my late 30s, and my wife and I own a house near downtown Toronto; our middle-class friends and colleagues who do not yet own property will likely never join us. Most of those hurling insults at Ms. Atwood on Twitter are young, too. They – and we – accept that the city of the 2040s will be denser and busier, maybe even on our own blocks.

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Toronto's outspoken chief planner, Jennifer Keesmaat, stepped down this week and her replacement will have to negotiate this changing climate. Revising the zoning by-law should be a priority.

City politicians, too, should notice which way the wind is blowing. It is time to have a frank conversation about where and how our cities are growing. It is time to make room for people and less room for stale ideas.

Alex Bozikovic is The Globe and Mail's architecture critic and author of Toronto Architecture: A City Guide.