Notwithstanding my above comment, this is a valid concern that governments need to address if they move to a 'untied rent subsidy' approach. In my opinion, the

Notwithstanding my above comment, this is a valid concern that governments need to address if they move to a 'untied rent subsidy' approach. In my opinion, the best way to address this problem is to take measures that increase the elasticity of housing supply, and reduce distortions in housing and land markets. So things like: replacing transfer duties with land value taxation, relaxation of zoning regulations, removal of any unnecessary regulations on dwelling density/height etc. Hell, they could probably achieve a pareto improvement (though probably a lower one) by completely separating government supply of additional housing stock and provision of rent subsidies. In other words, it would be better, relative to current social housing schemes, if the government just built and sold houses at market value while separately providing rent subsidies to the financially disadvantaged.