Can't get local OSM API server to return any map data

I'm trying to set up my own Rails Port OSM API server as my application needs to make a very large number of map queries.

I finally have everything looking like it should work but when I query a region of the map that has been populated from a .osm file using osm2pgsql I just get the wrapper nodes with no actual content returned. It's as though the region I'm querying has not been populated with data.

The details:

I'm using an Ubuntu 16.04 running on a Virtual Machine.

I followed all steps described here: https://github.com/openstreetmap/openstreetmap-website/blob/master/INSTALL.md . But I had to change a few things due to version and package name changes. So I ended up installing these:

sudo apt-get install ruby libruby ruby-dev \
                 libmagickwand-dev libxml2-dev libxslt1-dev nodejs \
                 apache2 apache2-dev build-essential git-core \
                 postgresql postgresql-contrib libpq-dev postgresql-server-dev-all \
                 libsasl2-dev imagemagick
sudo gem install bundler

I got error messages later on in the process regarding not having svgo installed, so I also ended up installing this to get rid of the errors:

sudo apt-get install npm
sudo npm install -g svgo

# and due to https://github.com/nodejs/node-v0.x-archive/issues/3911 :
sudo ln -s /usr/bin/nodejs /usr/bin/node

To fix some other errors I got when trying to run osm2pgsql I found I had to add PostGIS support to database:

psql -U <user> <database>
e.g. psql -U myusername openstreetmap
at prompt type:
    CREATE EXTENSION postgis;
    \q      // to exit

I got hold of the Bonn, Germany .osm.bz2 file from mapzen.com/data/metro-extracts/

I populated this into the database:

osm2pgsql -s -U myusername -d openstreetmap bonn_germany.osm.bz2

I carefully examined the log generated and there were no errors and the import seemed to be successful.

I started the Rails Port webserver: bundle exec rails server

From a webpage on the same PC I did a REST query for a small region that is inside Bonn:

localhost:3000/api/0.6/map?bbox=7.0974,50.7321,7.0982,50.7325

I got a response so I know the server is running, but the response just contained the following:

   <osm version="0.6" generator="OpenStreetMap server" copyright="OpenStreetMap and contributors" attribution="http://www.openstreetmap.org/copyright" license="http://opendatacommons.org/licenses/odbl/1-0/">

        <bounds minlat="50.7321" minlon="7.0974" maxlat="50.7325" maxlon="7.0982">

    </osm>

So I'm just getting the wrapper nodes with no data for the region inside the bounding box.

If I make the same query to the public server:

www.openstreetmap.com/api/0.6/map?bbox=7.0974,50.7321,7.0982,50.7325

Then I get a long list of nodes and ways from inside the bounding box as expected.

Any idea what I am doing wrong?

Thanks