Churches have a vital role to play in tackling Britain's housing crisis, according to a new report.

There is a widespread recognition that the UK has not built enough houses for its growing population for many years, and that many provided for low-income families are of poor quality.

Produced by Housing Justice and the Centre for Theology and Community, Our Common Heritage says that churches can work with housing associations to provide land for social housing, help meet the spiritual needs of residents and lobby on housing issues.

The report says that more than five million people in the UK live in housing associations – private, not-for-profit organisations aimed at providing low-cost housing. Churches were deeply involved in the movement from its beginnings in the 19th century. However, the report says that the Church's significance "lies more in its ability to highlight new problems and shape the agendas of Government", adding: "The Church was able to play this role because it was part of those deprived communities – present and engaged – and therefore more fully aware of the reality of poverty than many others at the time."

The report says that house prices almost doubled in the ten years after 2000 and rent rises have also put pressure on affordability. It calls for a "radical change" to how the housing market operates. "Homes and neighbourhoods are more than simply assets to be traded," it says. "They are gifts from God, and they also have a significance which is bound up with the story and history of the people who live in them."

David Orr, Chief Executive of the National Housing Federation, said: "If there is one issue that requires a concerted and cooperative approach to address, it is the housing crisis. Churches and housing associations are present within almost every community and occupy unique spaces within them. By bringing together our assets and skills, churches and housing associations can go further in creating lasting change in our communities."

Ven Rachel Treweek, Archdeacon Of Hackney and Bishop-Elect of Gloucester, said: "I have seen at first hand what the Church can do in partnership with others: how it has been at the heart of initiatives which have secured a Living Wage for low-paid workers, challenged exploitative lending and supported ethical alternatives.

"I believe the Church can have the same transformative impact on the issue of housing, if we are willing to work with people of good will far beyond our walls. This report has an important part to play in turning that vision into a reality."