Communism

those apartments were a big upgrade for people from rural regions.

From urban regions too, old buildings from XIX century and from before WW2 were much worse standards, often without proper plumbing and heating. Also socialist countries were heavily devastated in WW2, so before they build those people often were living in temporal or overcrowded places. Polulations were also growing quite fast. True homelessness was very rare under even wartorn socialist countries though.

These prefab panel apartment buildings
much nicer, organically grown mid-density residential areas of Western Europe

You do know that the prefab technique was invented in the West and a lot of western countries also have a lot of those? YOu don't get to compare it to "organically grown" (is that ephemism for patodeveloper craze?) burgie houses