Subsidies are needed because the region's and the city's rental rates [[something determined by markets, etc.) aren't high enough to pay for the construction [[something determined by the price of physical materials and labor which are independent of rental rates). The $2.00 per square foot number that you're always hearing is supposed to be about the number that is needed to support new construction without the kinds of subsidies we've been seeing so far.

Rents are rising probably as fast as they can. These things take time. A one bedroom that only cost 600 or 700 a month a few years ago now costs over a thousand a month.

Another aspect is financing. Banks/developers/investors look for comparable developments nearby when figuring out loan stuff, but in the past Detroit didn't have any. But after one project is successful, it's something that can be looked at, and then they say "that worked. we can do it too and it's safe to go a little bigger".

For both of these situations there's a sort of positive feedback loop. But each cycle of the loop takes time. Buildings take a few years from planning to construction. Rents are only raised once a year and will only be raised so much at a time.


But to say that this process isn't happening... You just have to not be paying very much attention to things. There's been a stream of new renovations at a faster pace than even just a few years ago. There are more small renovations than you can keep track of, and there's a handful of midrises which should start construction in not too long.

Just because there aren't dozens of 90 story skyscrapers being built doesn't mean that people aren't moving into downtown at a rapid pace. Demand has simply grown faster than what the market can accommodate, and the market is moving as fast as it can.