Labour leader Ed Miliband is due to announce the policy, intended to help deliver the party's pledge to build 200,000 homes every year by 2020, as part of the long-awaited Lyons Review later today.
According to a Labour Party pre-launch briefing, the report will say that insufficient land is coming forward and communities feel that they have no influence where homes will go.
Miliband will endorse the plans set out in the review, the briefing said, and set out policies to boost supply of new homes and ensure communities benefit from development locally.
Labour also said it would make it mandatory for local authorities to have a local plan to meet the housing needs of the local community.
"Where they do not allocate sufficient land or come forward with a plan the planning inspectorate will have powers to step-in and make sure housing need is not ignored," it said.
Other policy proposals will include plans to allow local authorities to designate new "Housing Growth Areas", which will have powers to assemble land and give certainty that building will take place.
On larger developments, Labour has also promised to ensure that a proportion of the planning gain would be used to invest in schools, roads, green spaces and GP surgeries.
The final policy proposal would see first-time buyers given priority access rights to new homes on sale in places where communities take the lead in bringing forward additional developments.
Miliband is expected to say that there has been a "systematic failure" to build the homes that are needed.
He is due to say: "We will get Britain building again by insisting local authorities have a plan to meet the need for housing in their area – and that the big developers play their part rather than hold land back".
The Party said the Lyons Report will also recommend that powers are introduced to allow groups of local authorities to collaborate and form Olympic-style New Homes Corporations to build on designated land at pace.
Other proposals include:
Measures to drive competition in the house building industry, increase capacity, and expand the number of small firms.
A Help to Build scheme to underwrite loans to small builders to get them building again and fast-track planning on small sites.
Financial incentives to local authorities so that they deliver a programme of new garden cities and garden suburbs to help unlock 500,000 homes.
Report author Sir Michael Lyons said the country faced "the biggest housing crisis in a generation".
He said: "[The report’s proposals] will require strong leadership from central government alongside the delegation of powers and responsibility so that every community provides the homes they need.
"The recommendations will make more land available for new homes; unlock investment in infrastructure; and ensure that new homes are built when and where they are needed in attractive, thriving places."