’affordable’ housing

"Can we afford 'affordable' housing?" by Richard Wellings:

Yesterday it was announced that the Greater London Authority (GLA) is to create 50,000 'affordable' homes. But do such schemes actually increase the affordability of housing?

When developers are forced to allocate a share of their dwellings (or land) to social housing or part-ownership it reduces their returns, since these properties will not be sold at full market value. Since the financial incentives to build are reduced, fewer homes are likely to be constructed. This reduction in supply will make housing in general less affordable - and it should be remembered that most people, even those on quite low incomes, have to find accommodation in the normal market.