I haven't played Sim City 4 for about a year now. This is the best I remember.

When the graph is high there is demand for it, but not enough Desirable realestate is around for the class of people that are moving in. When the graph is there is no demand and you need to build things that will create a demand. When it is low people are leaving and you need to create alot of demand. The best place for the graph is 1/4 the way up. This are desirable if they have a high YIMBY (Yes in my back yard) and a low NIMBY (Not in my back yard) you can get charts of all structors YIMBY and NIMBY values on many pages. Building must also have the services that the people need. The more better the services are the richer people will move in and the better the buildings will be.

Demand is based off of jobs. If people can get to their work in a resonable amount of time the demand will raise for residential. If they can not the demand will raise for comm and ind.

Remember you can build multiple cities in SC4 and connect them via roads and people will commute to work. This is the only way to get very very large cities.