Does smart growth regulation create price instability?

One argument I've seen in anti-smart growth literature is that regulation generally and/or smart growth-oriented regulation creates housing bubbles that lead to price instability.   

Attached is a chart showing the evolution of housing prices between 2000 and today. The two major regions with the most aggressively smart-growth-oriented regulation are Seattle and Portland (both of which have urban growth boundaries).  Neither seems particularly unstable according to the chart.  Nationally, prices increased by 105% from 2000 to the peak of the bubble, and by 58% in real terms from 2000 to today. Thus, the national "instability gap" (the amount of housing price increase that did not survive the recession) was 47%.  By contrast, Seattle prices were actually more stable than the rest of the nation, with an instability gap of 35% (89% housing price increase to peak of bubble, 54% from 2000 to today); Portland's "instability gap" seems even lower. 

So even if regulation generally feeds bubbles, it does not appear that urban growth boundaries, standing alone, do so.