The housing minister has said he will be “absolutely willing to use legal rules” to make builders pay for the removal of unsafe cladding from lower-height buildings.
Michael Gove has written to firms, giving them until March to agree a plan to protect leaseholders trapped in “unsellable homes”.
So far, residents in blocks 11-18m high have been ineligible for government support to remove unsafe cladding.
It has left many with crippling bills.
Mr Gove said some companies had shown leadership and covered the costs but others “had not shouldered their responsibilities.”
“It is neither fair nor decent that innocent leaseholders, many of whom have worked hard and made sacrifices to get a foot on the housing ladder, should be landed with bills they cannot afford to fix problems they did not cause,” he said in a letter to developers in England and Wales.
“For too many of the people living in properties your industry has built in recent years, their home has become a source of misery.”
The minister is expected to make a statement to the House of Commons later on Monday.
In his letter, Mr Gove warned he would take “all steps necessary” to make developers pay, including restricting access to government funding and future procurements.
He also said he would be willing to use planning powers and, if the industry failed to take responsibility, ultimately “impose a solution in law”.
The time limit for leaseholders to sue builders over defective flats will also be extended from 6 to 30 years.
The government says the vast majority of lower height buildings are safe and others that do have combustible cladding may also be safe or could be made safe using existing fire safety measures.
However, it said a small number have unsafe cladding that must be addressed.