Needed by whom? Why does someone who can't afford the prices deserve cheap housing downtown?

Yeah, but that's the point the parent is making. "Most needed" just means "high demand market", and in markets like that it's almost impossible to do anything to upset the trajectory of housing costs - unless we have another 2008-style mortgage crash because of fraud. The lesson to take here is that putting affordable housing in excessively expensive markets might actually be a really smart idea.