The House Builders' Federation has warned that plans to increase the proportion of social housing in rural areas will lead to price rises in the private market.
Plans to build 9000 affordable homes a year in the countryside were unveiled by deputy prime minister John Prescott in the rural white paper, published on Tuesday.
Prescott said better use would be made of the planning system to ensure social housing was included in developments.
HBF head of external affairs Julian Smith said: "We have no objection to social housing in principle but the problem is that not enough homes are available. There will still be people in the middle that are not eligible for social housing and cannot afford homes on the free market. Prices on the free market will increase."
Rural Housing Trust chief executive Moira Constable welcomed the move but said the quota was not high enough.
