New build homes are unaffordable for more than four-fifths of working privately renting families across England, according to Shelter.
The housing charity claimed new build homes were unaffordable to 83% of working families who rented privately, even for those using a Help to Buy equity loan scheme which only required a 5% deposit.
It based its calculations on average new build home prices, mortgage loan-to-income ratios using Council of Mortgage Lenders (CML) data and household income data. Homes were deemed unaffordable for households if their incomes were deemed not enough to secure a mortgage.
Shelter identified the West Midlands as the least affordable region, with a 93% of privately renting families struggling to afford to buy an average-priced new home.
The charity's research also found just over half (51%) of new home owners had experienced problems with their properties including issues with construction, unfinished fittings and faults with utilities.
Shelter claimed the current "speculative" way that housebuilding worked resulted in a conflict of interests and a highly combative local planning process, with landowners wanting to maximise their windfall up-front, finance providers wanting to minimise risk and the local community wanting to minimise the impact.
Instead, it wanted to see a "new civic housebuilding" system introduced to support the building of new, affordable high quality homes, with greater powers for local authorities over land in their area.
It said that under this scheme, land would be sold to the development group with the proposal that most closely met the needs of the community, rather than selling to the highest bidder alone. Shelter said that lower land prices would mean developers did not need to keep house prices "artificially high" to turn a profit.
Under Shelter's proposed initiative, landowners could choose to sell at reasonable prices, or to invest their land as equity and own shares in a development, taking long-term returns and a share of the profit.
Shelter said civic housebuilding that met the needs of communities was used to deliver the Georgian "new towns" of Edinburgh and Bath, the Edwardian garden cities and the post-war new towns.
Graeme Brown, Shelter's interim chief executive, said families had given up on the idea of home ownership in a system that was "rigged".
He said: "The current way of building homes has had its day and it has failed the nation."
The Government recently launched a white paper to boost housebuilding and fix the "broken" housing market.
Under the reforms, every local area will need to produce plans to make sure enough land is released in areas where people want to live.
A Department for Communities and Local Government (DCLG) spokesman said: "This Government has got the country building again with the highest number of housing starts for nearly a decade.
"But we agree with Shelter that the housing market in this country is broken, which is why last month, in a housing white paper, this Government set out bold and lasting reforms to fix it.
"Our reforms will help build more affordable homes, more quickly, for those currently locked out of the market."