Angela Rayner has been accused of making the property crisis worse after a housebuilder lost its battle to construct hundreds of homes in south-east London.
Berkeley Group had mounted a legal challenge to revive plans to replace Peckham's derelict 1980s Aylesham Centre with 867 homes, but its appeal was rejected by a judge on Monday.
Ms Rayner's officials in the Ministry of Housing, Communities and Local Government (MHCLG) have also frozen a second Berkeley project, for 586 homes, at the redundant Motspur Park gasworks in Kingston.
Rob Perrins, the chief executive of Berkeley Group, warned on Wednesday that the decisions underscored the "gulf between positive planning policies and what actually happens when you try to build homes in London".
With its projects repeatedly rejected by councils and planning inspectors, Mr Perrins said the housebuilder was increasingly forced to rely on "hugely costly and slow" legal appeals or decisions by ministers to secure approval for developments.
Yet plans for its Motspur Park development were "immediately put on hold by central government" in August, Mr Perrins said, and now must be reviewed by Ms Rayner, despite securing consent from the Mayor of London's office.
Mr Perrins said: "All of this creates extreme uncertainty and is undermining the Government's housing agenda.
"Housing delivery in London is at a record low. At a time when we should be fighting to attract investment and build more homes, we're fighting it off. The result is fewer homes, less growth and a worsening housing crisis."
In Peckham, the housebuilder had applied to build homes in more than a dozen tower blocks running up to 20 storeys high, served by a new Morrisons supermarket.
But its proposals were rejected by the planning inspectorate in May on heritage grounds, which ruled they were "visually intrusive".
Mr Perrins described the Peckham saga as a "10-year planning nightmare", adding that Historic England, the heritage watchdog, had not objected to the plans.
"The outcome is no new investment, no jobs, no homes," he added. "All the policies support housing, but the decisions block it time and time again."
The site has been earmarked for housing since 2014. It is estimated the project would generate nearly 1,000 jobs along with £15m for the council to invest in the community.
But local groups protested against the project, including Aylesham Community Action, labelling it "gentrification [on] steroids". The campaign was backed by Miatta Fahnbulleh, the local Labour MP who was appointed Energy Secretary in July.
Lord Khan , the Mayor of London, meanwhile, called in and approved Berkeley's Motspur Park development after councillors rejected the proposal in March.
But the Housing Secretary issued a holding direction in August that bars City Hall from officially granting consent, despite Andy Burnham's pledge to leave more control of building projects to mayors.
Separately on Wednesday, Taylor Wimpey, a competitor to Berkeley, said it had no more plans to build new homes in London and warned the city's housing market was "fundamentally broken".
Jennie Daly, the chief executive of Taylor Wimpey, told The Times: "Baseline viability is, I think, fundamentally broken in London.
"The reward for undertaking what is a very high-risk form of development in London has just evaporated."
A spokesman for the MHCLG said its planning reforms had led to a 298pc increase in new London housing starts compared to a year ago. It is also investing £11.7bn into council housing in the capital.
He added: "We are also backing the Mayor of London and working closely with industry to get more homes built for Londoners – making sure good schemes are not left in limbo while unlocking jobs, growth and opportunity."
