This would be a compelling complaint if the rest of the world didn't exist.
Every complaint about apartments stems from American inner city dilapidation. My first culture shock when arriving in the US was the sorry state of American apartments.
We know how to build apartments that are insulated to sound. Common building courtyards give kids safe play-areas within walking distance while supervised. Balconies can be built large and large common areas give people all the space they need.
Back in India, urban army cantonments used to be one of the best places to live. Funnily enough, they were simply gated colonies with large apartment complexes, and the recovered space was used for community activities and sports. That's all we're talking about.
Take the same surface area. You can choose to build in 2d (SFH) or in 3d (buildings). No where does this imply stuffing people like sardines. All they're saying is that if you optimize for your priorities in 3d it is unlikely that the 2d edge case will be most effective outcome.