Bankrupt and boarded up – the city of Detroit hardly sounds like an inspiring place to work on your novel. But if your rent is covered – then suddenly the prospect is a lot more appealing. Detroit non-profit organisation Write a House is renovating two three-bedroom houses and is accepting applications (worldwide) for writers to move in rent-free. If the writers stay for two years, they get the deeds to the house. I suspect the organisation won’t be short of applications.

The perennial question among most creative people I know is not what to create, but how to create: how am I going to write this book/play/polemic and also pay the rent? It’s a tricky balance. Apart from a lucky few writers who get big advances or grants, most novelists cannot live off their work. They need a second (or even third) job to keep on writing.

There is a degree of cultural urgency to the situation in Australia. The average advance and time needed to create a decent book are wholly incompatible with the cost of living in Sydney or Melbourne. Priced out, writers move out of the boho enclaves and the corporate crowd moves in. The city – in not supporting artists – becomes a more homogenous less diverse place. It happened in Manhattan, where now most new writing is coming out of Brooklyn. But with most of Brooklyn rapidly gentrifying, less established writers are again being priced out. Where to next? 

Last year, the Sydney Morning Herald published a fairly depressing article on Australian writers’ income. It reported authors earn on average $11,000 a year – approximately one-sixth of average annual income. And these are the lucky writers – the ones getting published. The question of where to live on such a low income while trying to write becomes crucial: in the middle of nowhere with cheap rent, or in the city where day jobs help pay for housing? Compromise clouds every decision.

Virginia Woolf wrote that “a woman must have money and a room of her own if she is to write fiction.” Over the years I’ve written in monasteries, the British museum, libraries, vacant holiday houses, beach shacks, at pubs, cafes – all borrowed spaces where I’ve tried to access some stillness to allow the words to follow. 

But finding a space of my own to write in one of Australia’s capital cities is like finding a unicorn. The high cost of housing in most of the country’s big cities means the writer trying to live off her craft is edged out – either of the city or from her work. Of course, you can do sharehousing (as I have done over the years to try and save cash), but the pay-off means sacrificing the space and solitude needed to really get deep into your book.

Sydney – long ago unaffordable to most jobbing writers – isn’t a place where you’ll overhear a lot of people talking about problems with plot and character development. Instead, the talk is about limited places at day care and stress-inducing mortgages. The city of Sydney recently tried to address the problem of artists being priced out by introducing six rent-subsidised studio spaces in Darlinghurst. Those chosen get a year-lease and pay reduced rent of $250 a week on a one-bedroom with work studio. In the meantime, to overhear the writerly conversations , you have to head west – towards the Blue Mountains, where there is a strong writing community creating work in a more affordable locale. 

It can pay-off to make your city affordable and welcoming to artists. A decade ago Berlin’s mayor Klaus Wowereit tried to attract a creative class to the city by declaring “Berlin ist arm, aber sexy” (poor but sexy). Now the city is booming. Berlin is seen the coolest city in Europe – and the third most visited tourist destination after London and Paris. The city is also adding 30,000 residents every year – despite Germany’s population stagnating.

There is an economic rationalist argument against subsiding housing for artists. After all, these people have made a choice to be in a low-paying high-risk (in terms of success) industry. Why should people who have to clean hospital wards subsidise the housing of some hipster novelist? But without writers living in the city, we also risk missing out on that city’s stories being captured on the page. Who hasn’t read a contemporary novel set in Melbourne or Sydney (not that there are many of them) and thrilled with recognition at the places re-imagined, dense with other people’s interior lives? It’s how empathy develops.

As the cost of living rises and advances fall, it may be that we don’t really get to read about our own cities anymore. Instead, we’ll pick up a novel by a hot new Australian author – set in Detroit.

• Brigid Delaney is the author a novel, Wild Things, to be published by Harper Collins in May (it is set in Melbourne)