The automatic town growth is much slower so you don't get the same difference in house/pop as you can get by build/reset/reclaim. Even after many years the highest houses with <500 pop I usually see are 22/23, whereas with maximum growth rate you can get 28-30 houses and still be under 500. At 16 GR that's 2 houses per month - so you'd be 3-4 minutes ahead with build/reset than you would be by waiting (and the wait would be less). I would assume it's cheating because you are deliberately manipulating factors outside the official game mechanics to give yourself a headstart - but if the admins think it's OK..?
Note that towns only self-grow if there other players in the game, and you then run the risk of one of them winning before you finish. A good player who starts on day 1 will win over the same quality player who waits for a bigger town (and a player who builds/resets) - it takes 15-20min of not playing to get a 10min headstart on your personal time. The build/reset method works even if no-one else is playing - the game just pauses when you exit and you only lose a month or two rebuilding your stations/networks before your town is growing again.
Even when faster trains are available I think the best strategy is still to use the Floss 47 - it's cheaper so you don't max. out the loan as fast and it's still fast enough to meet all the demands, at least in 4k/8k games - 25k may be different I've never tried it.
