The London Housing Statement 2002, published jointly by the Government Office for London and the Housing Corporation, called for an increase in the supply of affordable housing and the development of the private rented sector.
It said poverty needed to be tackled by reducing homelessness, bringing social housing up to decent standards and promoting regeneration.
Housing minister Jeff Rooker said: 'London is a city of wealth and opportunity,
He added that these problems could not be tackled overnight, but 'by working closely with a wide range of partners' real progress could be made.
The statement revealed that the demand for housing has been growing at an alarming rate. London's population is projected to top eight million over the next 15 years. At the moment nearly 32,000 new homes are needed each year - 25,000 of which should be affordable.
The report found too many people were living in areas of high poverty. The numbers of homeless have been rising over the
last three years and a disproportionate number of these - 52% -come from ethnic minorities.