While the focus on regeneration has resulted in 74 per cent of all developments in 2005 being built on previously used land, the DCLG believes there is still plenty of capacity for further homes.
In the South East, where demand for housing is greatest, there is potential for over 400,000 new homes to be built on currently derelict land.
Baroness Kay Andrews, Lords Planning Minister, said: “This government has made it clear that suitable brownfield land must be a priority for any new development, and that is why three-quarters of all new peoperty developments are already being built on previously developed sites.
“There is a real need to build more homes if we are to meet the housing needs of future generations and these statistics show many of these could go on re-used sites.”
The DCLG believed 44 per cent of all derelict land across England could yield residential property, although it admitted not all of it will be available in the near future.
However, it revealed building on brownfield sites had increased from 56 per cent since 1997, with 11 per cent less land being left derelict now compared with 2001.
Simon Biddle, head of marketing and communications at Infinity Mortgages, said: “The development of brownfield sites must be seen as essential, especially in the South East. However, while the tendency should be to develop brownfield sites, there must be some greenfield developments as this is where people want to live.
“We are staring down the barrel of a housing shortage and if we continue to build on brownfield sites, it will be of benefit to the overall housing stock. A lack of housing is holding up the movement of workers so we need to address this quickly and not ignore the problem.”