The Capitol is far from the strongest building in the city, but I still agree that allowing it to be built on day 3 is an overreach. Not even because of the starting city, where it is unlikely to be in demand, but because of the additional cities that will simply be built for economic gain at an accelerated pace.
The numbers to the left of the diagram indicate the thresholds (required city levels). The Capitol is at level 7 of the city, i.e., it can be built on day 5 of the first week.
Doesn't level 7 mean that you need to build 6 other buildings to construct the Capitol? That is, we can only build level 7 on day 7. Then it's normal; on day 7, it's desirable to build a Dwelling or Forts, and on day 8, buy troops, but building the Capitol on day 3-5 is overpowered!
P.S. Why does the Hydra have a growth rate of 1-2 instead of 2-3? Do you want to make it a top-tier creature of Tier 6? Isn't it too much for a faction to have both Tier 7 and Tier 6 top-tier creatures?
P.P.S. I really like the 5x5 building scheme with a full line of Governor-Capitol! Only, in my opinion, the arrow from the Predators to the Altar of Elements is unnecessary.