The waiting list is growing, but fewer affordable homes are being built
The recession is hampering efforts to address the shortage of affordable housing in the South West, according to the Devon Housing Development Forum.
Government figures show the number of people waiting for affordable homes in the region has risen to 63,000.
But local authorities are having to relax their affordable housing targets on new developments to ensure they still get built.
Would-be buyers have said it made it harder to get on the property ladder.
Paul Barnard, the assistant director of development at Plymouth City Council, said developers were driving a hard bargain during the recession, but it was important to keep projects moving.
"It's about negotiating with developers and getting an overall package of community benefits, which includes affordable housing," he told BBC News.
The council had to take a balanced view to ensure the regeneration of the city continued to move forward, Mr Barnard added.
Last week, Plymouth City Council voted unanimously to revised plans for the Sherford Valley development on the outskirts of the city.
Originally, about 45% of the 5,500 homes were to be affordable, but developer Red Tree said it had to reduce that percentage because of current market conditions - and it now stands at about 25%.
Developers believe building new houses will kick start the economy and affordable homes targets can be increased again once the market recovers.
But Tim Jones, the chairman of Devon Housing Development Forum, said it was a worrying situation which had to be addressed.
"If the builders cannot provide us with affordable housing accommodation, then we've got to find another way to do it and we've got to do it quickly because otherwise we're going to keep falling back," he said.