I am sure that we would love it if we were to be given planning permission to build all over our rural land, it would sort out all our financial problems as our land would be valued as building land rather than agricultural land.

Actually 129,000 acres is not that much when you consider that it is 200 or so moderately viable farms.  Bearing in mind that some of it has bodies in it or is in small plots, it does not produce much.

The real question is where has the land gone since 1872 when the Church owned 1.5 million acres?

The Church is no longer one of the big landowners.  Crown Estates, the Duchy of Lancaster, the Ministry of Defence and private owners are the biggest owners.  No one really knows who owns it all as much only gets registered when sold or mortgaged.  All we know is that only 8% of one of the most heavily populated countries in Europe is built on.

#2: If there were fewer second (or third) homes, there would be room for all.

A few years ago I read that the average American lives in a house of 1400 square feet for which we pay 3 1/2 year’s income; the average Briton lives in half the space and pays twice as much.

This seems like a terrifically bad idea given the pending Equality Bill.  Persons given renting rights do have rights which are defended by the government, which has shown itself to have few qualms in creating legislation which allows for lawsuits to be filed for the sake of undermining church doctrine and the atmosphere of Godliness within church institutions.

Were churches to begin renting this land, it could easily find itself in conflict with gay nightclubs, swingers, or alternative religions which are hostile to the church, and which have a more “provocative” image as opposed to the type of image which most churches have.

Some churches do indeed dare to be “provocative” and don’t mind establishing presences near strip clubs or other places where some clients might ... feel uncomfortable about their presence.  But most don’t see this as their calling or the appropriate way of presenting their message or creating a presence.  On the other hand, strip clubs and gay organizations have been known to openly portray clashes with Christianity ... think of the nun fetishim, the Sisters of Perpetual Indulgence, etc. etc..

Church organizations just don’t tend to be “agonistic” like that.  Conflict isn’t a model which churches seek.