An independent group of housing leaders has called on the government to provide a £1.3bn fund to buy up private housing for social rent.

The Affordable Housing Commission says a National Housing Conversion Fund would help support tenants and drive economic recovery.

The group expects some £1.255bn in grant funding would deliver an expected 42,500 new social and affordable homes and create 9,300 jobs. Taking into account wider benefits, it said this would be at a net cost of £623m to the government.

The fund would enable social landlords and community-led housing groups to acquire private rented housing and homes for sale on stalled sites in low value areas.

The group says buying distressed private properties would mitigate the anticipated slump in prices and kickstart development.

Lord Richard Best, chair of the Affordable Housing Commission, said: “We believe the chancellor has a great opportunity to stimulate the economy, boost jobs and tackle the housing crisis by backing plans for a National Housing Conversion Fund.

“This would bring empty and run-down properties back to life, stimulate activity on stalled sites, and assist landlords exiting the market, while addressing the acute shortage of homes at truly affordable rents.”