The planning body for the region, Serplan, has confirmed that it is consulting on plans to build between 875,000 and 914,000 homes outside London by 2016 - nearly 20% fewer than government projections suggest the region will require.
The House Builders Federation said Serplan's draft strategy wrongly assumed London would provide for all its household growth, without spillover into surrounding counties.
'This will have an alarming impact on those on the lowest rungs of the ladder. Pricing people and first-time buyers out of the market will lead to social exclusion, placing a greater burden on social housing requirements.'
The CPRE said the government should use fiscal incentives such as a levy on mineral extraction to control the environmental impact of development and strengthen planning guidance.