Up to 300,000 homes scheduled for construction over the next two years will not be built due to changes in the planning laws, according to the National Housing Federation.
Communities Secretary Eric Pickles scrapped regional targets for house-building earlier this year, describing them as “terrible, expensive and time-consuming”.
But the Federation, which represents housing associations, said that as a result, local authorities have cancelled plans for building 160,000 new homes this year, and a total of 300,000 by the end of 2011.
It added that new proposals to reward councils for building new homes will not make up the shortfall.
Federation chief executive David Orr said: "The building of homes must be promoted as mission critical."
Only 123,000 homes were built in 2009/10 – the lowest figure since 1923. Some 4.5 million people are currently on housing waiting lists.