You mean, what’s the fallout of banning anyone or any business regardless of the circumstances from owning more than one property?
Starting with the obvious one, it incentivizes investors to form multiple legal entities to own multiple properties — thereby entirely defeating the proposed regulations. This is already how it works today amongst informed property investors (though for reasons of legal liability, privacy and wealth protection rather than skirting regulations).
But assuming you could close this (realistically impossible to close) loophole... I’m guessing people in this hypothetical fantasy would prefer buying huge tracts of land, and building ADUs? Rentals would likely become a lot more scarce. Maybe corruption would rise due to the general ridiculousness of the proposed regs. Dunno. What do you think?