That's a chicken and egg problem. Most companies want to hire where the labor already is, aka the big expensive cities, and most workers, especially immigrants from abroad, want to live in the big cities as those have the most jobs and the population there is less conservative and racist towards outsiders meaning it's also easier to build relationships and get along with just English without having to struggle with the local language.
It's nearly impossible to convince companies and people to invest in small cities on the offshot that they naturally become the successes they dream of later since it's not something the government can guarantee, nor do we live in prosperous times of cheap money pouring from the sky that would enable governments to fund crazy projects of building attractive infrastrucutre.
Germany's rental market is absolutely insane.
(but obviously this article is not about Germany)
We need to bring more migrants, so there are 500 applicants. That will bring price down for sure!
You either build more housing to math the demand, or you restrict the demand from the number of people coming to move in.
> If there are at least 50 applicants, arguably, perhaps the price is too low...
Yes, prices are too low. Yes, you cannot increase prices. Status quo.
Generally I agree to your point - if demand is high, prices will be high. People should move somewhere else.