The government faced fresh pressure this week to cut its housing growth plans in the South-east after the publication of a House of Lords report.
The findings, published this week by the science and technology select committee, criticises ministers for underestimating the amount of water needed to cater for developments.
It says: "The government failed to consider the water management implications of its housebuilding plans at an early enough stage, and its belated estimates of the growth in demand are wholly unconvincing. Along with the Environment Agency, they must ensure that the water companies' plans factor in what is bound to be a significant increase in demand."
The committee calls for the EA and the water companies to be added to the list of bodies that developers must consult when submitting planning applications, so that they can monitor the impact of schemes on water supply.
It also calls for greater recycling of water in housing developments.
Stuart Baseley, the chief executive of the Home Builders Federation, said: "It is crucial to recognise that houses do not use water - people do - and it is the people who are living and working in the South-east now who need homes.
"We should also ensure that all new-build homes have compulsory water metering, and housebuilders are leading on the development and installation of new water-efficient fittings."