Landlords who sign up to a minimum-standards scheme would be given incentives to improve the maintenance and management of their properties, said the Chartered Institute of Housing and the Resolution Foundation.
The report also warns that more effective regulation is needed to tackle rogue landlords and calls for letting agents to be banned from charging tenants fees.
Private landlords currently receive around £7billion in tax allowances each year, including for repairs and maintenance, but there is no incentive to carry out work above the minimum standard, the groups claim.
A study from Shelter earlier this year found that mMore than 200,000 renters in England are estimated to have been the victims of a ‘revenge eviction’ in the last year after asking for a problem with their home to be put right.
It said one in 50 (2 per cent) private sector tenants said they had been evicted or served with an eviction notice because they had complained to their landlord or letting agent about something that was not their responsibility - such as a fault that needed repair - or had complained to their council when their landlord or letting agent had refused to carry out repairs.
The CIH, which represents housing professionals, and the RF, which campaigns for better living standards for low to modest income families, said a third of privately-rented homes failed to meet modern standards.
The private rented sector has doubled in size since 1992 to four million households and now accounts for 18 per cent of all households in England, they said.
Meanwhile, the percentage of private renters aged 25 to 34 rose from 31 per cent in 2008/09 to 45 per cent in 2012/13.
CIH chief executive Grainia Long said: 'This Government has focused on measures to boost home ownership, but with more and more people living in the private rented sector - including more older people, more families with children and more vulnerable people from the housing waiting list - it's vital that we look at new ways to raise standards.
'The cost of housing means that for many people, the private rented sector is the only option, but too many of them are having to put up with poor standards and insecurity.
'Ultimately, we want people to have a good choice of housing at a price they can afford, so we need to make private rent a better option.'
RF deputy chief executive Vidhya Alakeson added: 'Many landlords already benefit from generous public subsidy but, while many of them are responsible, not all of them give anything in return.
'By introducing the principle of getting 'something for something' from this investment we could ensure that housing is improved and works better for both tenants and landlords. Government should incentivise those who work to raise their game in order to improve the overall standards of private renting.'
Click here to read original article'Give good landlords tax breaks to make rental housing better, report urges'