The BBC reports that subsidised 'key worker' housing is being misallocated. The housing is meant for nurses, junior doctors, teachers, and other people of little means but a requirement to live in cities like London. Some of the cost is subsidised by the government and housing associations so that those on low wages can still live there and have part ownership.

As with every government scheme, it has been open to significant abuse and 40% of the subsidised housing has been sold to people who aren't key workers. Those discovered to be living in the properties include a financial controller for one of the UK's largest companies, a housing association worker, Harrods' staff, a bank manager, and several accountants. In the North of England, up to 80% of buyers could have afforded a house on their own terms and clearly weren't the intended beneficiaries of subsidised ownership.

As the eminent economist Thomas Sowell argues, the government should keep its hands out of the economy and allow the free market to present its own solutions to these problems. Subsidised housing is a poor answer to a major problem. My suggested solutions are to loosen planning laws and open up the green belt, tax non-primary home purchases, and/or enforce property use.

Revoke planning laws (preferred 'free market' solution):

High prices are caused by high demand and low supply. The government's attempts to induce construction companies to build cheap housing on approved sites have failed wonderfully. There's little incentive to build cheap housing if 'executive' housing continues to sell so well. The answer is to allow the amount of land used for housing to increase substantially. The amount of British land that's been built on is still in the single percent and significant amounts of agricultural land is going unused as our economy moves on.

Removing the green belt limitations is going to upset a lot of commuter belt dwellers who don't realize that the green belt has already been ruined by thousands of Tesco stores, burger outlets, and congestion. They might as well accept it and build on the land surrounding the traffic jams, supermarkets, and McDonalds. This solution will also face the wrath of ignorant, greedy property owners who, sadly, make up a large percentage of the voting public.

This solution is my favourite, since it'd allow those with the means (but not enough means to pay the hyper-inflated prices of late) to buy agricultural land and erect property. Enough planning laws could be kept in place to ensure properties built are of the correct character for the local area and do not impede on neighbours' rights, but we should remove the laws that allow planning authorities to blindly reject proposals to build on agricultural land.

However, there are at least two less radical options..

Tax on non-primary home purchases ('still let the government meddle' solution):

This idea has been thrown around in Parliament for a while now, but no-one seems willing to commit to it. The idea is simple. Charge VAT (or some other tax) on non-primary home purchases. Your primary property is tax free (eradicate stamp duty too), but any second or third homes attract VAT. With the reasonably low level of second home ownership (5% by recent estimates I've seen), this might not be the panacea I'm looking for though.

Enforce property use ('still let the government meddle but keep middle England happy' solution):

A significant amount of property around where my parents live is empty for 6-9 months of the year. A lot of smaller villages and towns in vacation destinations are experiencing the same problems, with local amenities and stores going out of business due to the lack of winter trade. In towns, too, property is bought and left empty either because the owner isn't willing to renovate it or is sitting on it as an investment.

Enforcing property use would bring a lot of property back onto the market, whether for purchase or rent. Land is not an infinite resource, so it's fair to enforce that land you own is being used properly.. a form of land conservation, if you will. Whereas petrol prices punish you for making pointless journeys in your car, there's no penalty on buying multiple houses and leaving them empty. Owners should be encouraged to rent unused property out or be taxed punitively (it wouldn't be a tax affecting legitimate property use, more a deterrent of property misuse).