Developers will automatically be given permission to build on suitable disused industrial land under major reforms to boost housebuilding, George Osborne has announced.
More derelict brownfield plots could also be seized for development through beefed-up compulsory purchase powers under the plan unveiled by the Chancellor.
Major infrastructure projects that include new housing will be fast tracked and Whitehall will step in if councils fail to act to meet local housing demands.
The measures are part of the Chancellor's Fixing the Foundations package, billed by the Treasury as the second half of the Budget, which is aimed at boosting productivity.
Critics are likely to accuse the Government of stripping opponents of new developments of vital powers to object.
But Mr Osborne insisted the plans would help tackle the housing shortage and make Britain more prosperous.
He said: "Britain has been incapable of building enough homes. The reforms we made to the planning system in the last parliament have started to improve the situation: planning permissions and housing starts are at a seven-year high.
"But we need to go further and I am not prepared to stand by when people who want to get on the housing ladder can't do so. We'll keep on protecting the green belt, but these latest planning reforms are a vital part of a comprehensive plan to confront the challenge of our lifetime and raise productivity and living standards.
"This will not be achieved overnight and will require a truly national effort by government, business and working people. But with this productivity plan, I believe that we have taken the vital first step towards securing the prosperity and livelihoods of generations to come.
"It is my ambition that by 2030, Britain becomes the richest of all major economies."
A new zonal system giving automatic planning permission on all suitable brownfield sites will be introduced under the reforms.
Government will draw up plans to meet local housing demands if councils fail to produce their own and will impose penalties on authorities if they make less than half of planning decisions on time.
Planning powers will be devolved to mayors in London and Manchester while permission to build upwards to the height of the adjoining building will no longer be needed in the capital under the proposals.
Enhanced compulsory purchase powers will allow more brownfield land to be made available while major infrastructure projects with housing incorporated will be given a speedier passage through the Nationally Significant Infrastructure Regime (NSIP).
Extra support for smaller house builders will include new sanctions for local authorities that do not deal with applications quickly enough.
British workers' output levels lag behind other leading nations and the issue has become known as the productivity puzzle
Boosting the rate to US levels would increase national income by 31% while just a 0.1% hike would grow the economy by £35bn in 2030, around £1,100 extra for every household, according to the Treasury.
The 90-page report, being launched in Birmingham, will also set out proposals for higher education, transport, trade, devolution of power to cities and regions, skills, long-term investment, tax, digital and science.
Business Secretary Sajid Javid said: "This plan lays the foundations for a stronger future. Every part of government will be involved.
"Under-supply of housing pushes up house prices in many areas and means millions of people can't live and work where they want to, or even own their own home. We are absolutely determined to see more planning permissions granted and more houses built."