You've mentioned demand for housing as a determinant of rents - but there is also supply of houses and apartments. You can make rents lower by building more, and quality of life can stay the same or improve provided that your infrastructure and regulations are well thought out.
Saying you'll make "cheap housing" where people will nonetheless want to be is complete nonsense. If people want to live there the rent will go up; the only way to make the rent low is to make the place utterly undesirable.