There are lots of sparsely populated areas in CA where developers can effectively build whatever they want.
But they're sparsely populated areas because they're undesirable for one or more reasons: too hot, or too dry, or too plain, or too far from the rest of civilization.
And no developer wants to be left holding the bag if the investment doesn't pan out... In fact, what happened in San Bernardino County and in Clark County (around Las Vegas) are exactly the types of failures that real estate developers have nightmares over.