Its what the developer can sell for.... he cannot sell for cost, so someone has to make up the difference & costs are increasing, the more you build, the more demand is for land, labour and materials.
We have no state builder so Barratts etc have to build and they want max profit...
Its a huge problem for any govt wanting more SH, now that the money from council house sales has dried up, what money that once raised, is long gone.