I've a one bedroom in a flatshare in east london, its nothing special & costs north of £1k / month. If a political party outlined how they'd fix spiralling house prices they'd get my vote.
It's really not that hard: remove height limits and parking minimums, per Yglesias in The Rent Is Too Damn High: http://www.amazon.com/Rent-Too-Damn-High-Matters-ebook/dp/B0.... Glaeser's The Triumph of the City is also good on this subject and discusses the UK more: http://www.amazon.com/Triumph-City-Greatest-Invention-Health.... This is a simple issue of supply and demand: rising demand in the face of limited supply means higher prices. Want lower prices? You need more housing or fewer people who want it. The former is easy to accomplish with century-old technologies, like steel and elevators.
FWIW, the London Plan currently contains restrictions on the maximum amount of parking provided:
http://www.london.gov.uk/thelondonplan/docs/londonplan08_ann...
table A4.2 Maximum Residential Car Parking Standards
Predominant housing type 4+ bed units 3 bed units 1–2 bed units
Car parking provision 2–1.5 spaces 1.5 – 1 space 1 to less than 1
per unit per unit space per unit*
* All developments in areas of good public transport accessibility and/or
town centres should aim for less than 1 space per unit.Brazil has problems too - http://cities-today.com/2014/07/finished-brazils-largest-cit...
A law that limits the rent increase to inflation + x.
Notes: Circumvention by "also buy this used kitchen for a ridiculous amount" would be illegal as well. Sucks for anyone trying to move into the city but doesn't force everyone who lives in the city to move out.
(Obviously sucks for anyone who's invested in real estate but we don't care for these folks, do we?.. Well, it sucks for everyone else as well.)
Regarding the investors, I am not sure how a reasonable rent increase along the inflation rate would suck; the fundamental building, maintenance and operating costs should also move with inflation. I have a little real estate myself and when I bought, my financial plan did not rely on a crazy rent spike 10 years down the road.
The current low interest rates push so much investment into real estate, while space for construction is limited in many places. How would you fix this situation?
I think that today's restrictions on building in many places are absolutely draconian, to the point of a chronic shortfall in the number of apartments built not just in city centers but in entire cities. I think that to some extent this is explained by a collusion of builders, property owners and bribed government officials (so corruption), and to some extent it's explained by the government liking to restrict building to preserve open space or what-not and not liking to do the work needed to plan and execute urban expansion at a decent rate (so laziness).
The jobs must go where these people live currently. Inconvenient for companies who like their offices in central (and expensive) locations, but doable.