>and "lack of profit potential is" also generally not the main impedance to creating new housing in most locations either.

It somewhat is. Housing builders can only do so many projects per whatever cycle they run. They will optimize towards building fewer projects that are highly profitable rather than building tons of low income housing or starter homes that each have much lower profit.

Builders don't want to scale up, they want to make money. Building would also be abysmal to scale up anyway, because it's somewhat skilled labor that you pay peanuts for.

This is just one of the ways that wealth inequality results in market failures.

People with lots and lots of wealth value each individual dollar significantly less, and are therefore willing to part with significantly more dollars per unit of service or product. That means you always get a much higher profit margin targeting stupid rich people than anything else. So everything is built around bilking these dumb but wealthy people for everything you can, and nobody builds or sells much to the poorer people. This drives prices for things up in general, and starves the market of oxygen for meeting the needs of less wealthy people.

Ask any developer, big or small, who their target market is, and they will not say "poor people" and this has been true for decades, and the difference between "poor" and "not poor" has only continued to grow.