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Kids can share a room but that still means an extra room, which has a cost. Plus kids come with stuff like clothing, toys, school supplies, etc.

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I never had my own room. Up until age of 14 I slept on bunk bed sharing a room with my brother and my parents, so it doesn't always mean a separate room.

If you don't own a home you have to rent and they simply won't and can't legally rent you too small an apartment or one with insufficient bedrooms.

In practice having 2 or 3 kids is going to mean going from studio/1 br to 2/3 br and double or triple housing costs.

That seems draconian. Is that a US federal/US state/other country law?

Same in Germany. There are minimum requirements on the living area for children.

State by state but the same most places. Even if the law would let you are you going to raise a family in your 350 sq studio?

Eurostat [0] would have you believe that you want 3 rooms for a family of 2 adults and 1 child. That's fine as an aspirational goal, but I feel that parents with a toddler living in a signle-room flat is good enough, especially for the baby.

[0]: https://ec.europa.eu/eurostat/statistics-explained/index.php...

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