Supporting the occupant is a more flexible and responsive method of providing affordable housing

Duke of Edinburgh

He said it was the most "flexible and responsive" way to make housing affordable, but the government has already rejected the idea.

The foundation's findings were presented to a conference on Tuesday along with a call for more low cost housing.

The report warns that the impending property shortage will hit London and the South East hardest, while in the North and Midlands there is the converse problem of low demand, leaving empty and abandoned properties.

Knock-on effects

The group said there was demand for around 210,000 new properties a year in England, but just 154,000 new homes had been built each year during the past five years.

Unless more homes are built, it would lead to a shortage of 1.1m homes in 20 years, it warns.

Rowntree report

210,000 new homes needed each year Only 154,000 new homes being built each year 1.1m shortage in 20 years

The knock-on effects could be an increase in homelessness and employees in the public services, such as teaching and nursing, unable to afford to buy their own homes.

Prince Philip told the conference these key workers needed "a system for supporting the occupant rather than the house".

The duke said: "[It] would also be able to cope with the opposite situation where someone in their own or in rented accommodation loses all or a significant proportion of their income.

Social issues

"From this point of view it would seem supporting the occupant is a more flexible and responsive method of providing affordable housing."

Lord Best, director of the Joseph Rowntree Foundation, said: "In our view, housing shortages are set to become one of the most significant social issues of the next 20 years.

"Unless we act now, shortages will lead to overcrowding and homelessness.

"But they will also have knock-on effects for the whole of society, driving up house prices in areas in high demand, inhibiting economic growth and making it harder for good quality public services to be delivered."

The report findings, which are being presented at the foundation's Centenary Housing Conference in London, come as the Royal Institution of Chartered Surveyors reported that property shortages were driving house prices up.

The foundation said the bulk of new homes could be built on recycled brownfield sites.