I've just spent the day at a seminar listening to various London councils expounding their plans for providing new council and affordable housing.

Just about every proposal relies on increased density and cash generated from the sale of private housing (mostly to Far East investors) to make it stack up financially.

Its the current high value and expected continuing rises in the value of these properties that subsidises the affordable/council stuff.

One council in particular was relying on future increases in the value of this private housing generated as a result of the improvements in the area.