Social and affordable housing provision should be at the centre of the coronavirus crisis recovery plan, according to a commission.
The Affordable Housing Commission warned that, without sufficient investment, more low-income families could be pushed into the private rented sector.
It said funding should be targeted at social rented properties for low-income households, many of whom are essential workers.
A recovery plan, with a focus on social rented and affordable housing, will encourage jobs and growth and rebalance the housing systemLord Best, Affordable Housing Commission
The commission was set up by think-tank the Smith Institute with the support of the Nationwide Foundation.
Its report said: “Without urgent action to increase the supply of affordable housing the gap between housing need and the supply of low-cost housing will widen over the coming years. More households will have no choice but to live in the private rented sector.”
Referring to the housing situation in England, the report warned: “Without a step-change in supply, the affordable-housing gap is likely to grow to 500,000 homes over the coming five years.”
The commission is chaired by Lord Best, a past chief executive of the National Housing Federation.
He said: “A recovery plan, with a focus on social rented and affordable housing, will encourage jobs and growth and rebalance the housing system so it is fit for purpose post Covid-19.
“As people face reduced incomes and potential unemployment the need for truly affordable social rented homes becomes even greater.
“With a weaker housing market and millions of renters under housing stress, this is the moment for the social-housing sector to step in, maintain the impetus for the construction industry and pick up the opportunities for growth.
“With decisive action from Government now, there could be a big step forward in easing the affordable-housing crisis.”
Darren Baxter, policy and partnerships manager at the Joseph Rowntree Foundation (JRF) said the ongoing impact of Covid-19 “has also shown just how many people were struggling to keep their heads above water before the pandemic, and how many more may find themselves trapped in poverty as a result of it”.
He continued: “High housing costs were a key driver of poverty in the UK before the pandemic, and now with unemployment rising, many people risk being pulled into hardship and even homelessness if they can no longer afford to meet their housing costs.
“To prevent this, the Government must strengthen the safety net for renters, so that our social security system can provide a lifeline for the thousands at risk of unemployment when the furlough scheme draws to a close.
“And as the task of rebuilding our economy begins, investment at scale in social and affordable housing must be a priority.”
David Renard, Local Government Association housing spokesman, said: “The Government should let councils take charge of the housing recovery, by giving them the powers and tools to build more of the affordable homes the country desperately needs.”
He added: “Now is the time for a genuine renaissance in council house-building that reduces homelessness, gets people off the streets for good, supports people’s wellbeing and is climate-friendly.”
A Ministry of Housing, Communities and Local Government spokesman said: “Building the homes this country needs is central to the mission of this Government and is an important part of the action we are taking to recover from the impact of the coronavirus.
“That’s why we’re rethinking the planning system from first principles to kickstart the construction industry and make it easier to build better homes where people want to live.
“We’re ensuring more much-needed social housing is delivered by removing the borrowing cap for councils and we are spending more than £12 billion on affordable housing from 2021 – the biggest cash investment in a decade.”