This is a theoretical ideal, where we ignore people's desire to own large tracts of land and live in quiet places. A mega-city where all the humans human, and then massive tracts of untouched wilderness shy of any industry that has to be there.

This is also why communist countries had stuff like dense housing in deeply rural areas, and why most people were shuffled into cities. Big houses and properties do nothing for the state and just encumber society. Way easier if everyone just lives in their tightly packed central shoe box.