Local authorities will be tested on the number of homes they deliver but will be given greater freedom to use existing brownfield sites.
The proposals also include a more transparent planning process to allow local authorities to work together and will add new quality standards for homes built.
Launching the consultation for the National Planning Policy Framework, prime minister Theresa May said these were fairer more effective planning rules.
She said the country needed more affordable homes for first-time buyers, for NHS staff and to rent.
The prime minister added that the changes would help allay fears frequently raised that new developments would swamp existing towns and villages by not providing enough infrastructure for new residents.
The consultation includes proposals for minimum density standards for city and town centres and other areas well served by public transport.
It says these standards should seek a significant uplift in the average density of residential development within such areas, unless it can be shown that there are strong reasons why this would be inappropriate.
The government also suggests planning permissions for upward extensions should be more readily approved.
This should be particularly so where the development would be consistent with the prevailing height and form of neighbouring properties and the overall street scene, and where safe access can be maintained.
The six key elements outlined in the consultation are:
Local authorities will have a new housing delivery test focused on driving up the numbers of homes actually delivered in their area, rather than numbers planned for. Developers will also be held to account for delivering the commitments, including affordable housing and the infrastructure needed to support communities.
Maximising the use of land
More freedom will be given to local authorities to make the most of existing brownfield land to build homes that maximise density. Use of redundant land will be encouraged such as under-utilised retail or industrial space for homes, with more flexibilities given to extend upwards on existing blocks of flats and houses as well as shops and offices. This will mean we can build the homes the country needs while maintaining strong protection for the Green Belt.
Maintaining strong protections for the environment
Ensuring developments result in a net gain to the environment where possible and increases the protection given to ancient woodland so they are not lost for future generations.
Ensuring the right homes are built
Delivering more affordable homes that meet the housing needs of everyone wherever they are in their life, including sites dedicated for first time buyers, build to rent homes with family friendly tenancies, guaranteed affordable homes for key workers and adapted homes for older people.
Higher quality and design
Introducing new quality standards so well designed new homes are built in places people are proud to live in and live next door to.
More transparent planning process
Local authorities will be encouraged to work together and continue to close the gap between planning permissions granted and homes built.
A new standardised approach to assessing housing need will be introduced with new measures to make the system of developer contributions clearer, simpler and more robust, so developers understand what’s expected of them and will be in no doubt that councils will hold them to their commitments.