The planning laws and social/physical infrastructure mitigate against initiatives and changes that would reduce the costs. One fundamental is that the rail gauge in the UK was the first one created, and this meant that tunnels and bridges were built unambitiously, consequentially there are no double decker trains in the UK. If there were double decker trains on the London commute lines London accommodation prices would be significantly reduced (I believe). That's just one small example of the complex confluence of issues that have driven the market in one direction though.

Everyone should remember that 60 years ago London housing was very poor as well as relatively expensive (although far more attainable). That's important as it shows that things can and will change over time in the market. We need to think about this because some of the reforms suggested will fundamentally alter the physical geography of the city in ways that will have consequences 100's of years into the future. Architects and planners have a very bad track record with respect to these alterations, for example see Birmingham, Portsmouth, Ipswich, Reading in contrast to Manchester, Brighton and Bristol where history has run differently (Bath is a really good story - the 60's got stopped in its tracks there).