The government should provide more social housing urgently and not increase right to buy, an influential group of MPs urged in a report on homelessness published on Thursday.

The ODPM select committee made its call three days after deputy prime minister John Prescott unveiled a scheme to allow housing association tenants to buy their homes as part of his five-year plan.

The report said the government had made substantial progress in reducing the number of rough sleepers and of families in bed-and-breakfast accommodation.

However it expressed concern at the rise in the number of homeless households in temporary accommodation and said there was a severe shortage of homes for people who were ready to leave hostels.

Andrew Bennett, MP for Denton and Reddish and chair of the committee, said: “We are deeply worried by the current situation, where over 100,000 households are homeless and people are stuck in temporary accommodation. It’s unacceptable to have so many homeless people in our society.”

He added: “We are completely opposed to any extension of the right to buy scheme.”

A spokesman for homelessness charity Shelter said: “It’s clear that only a significant and sustained increase in the number of new social rented homes will deal with this crisis. We hope all political parties take note and give an election manifesto committed to building more rented social housing.”