A report sent to Brighton and Hove City Council found more than 3,000 properties could be in use only as short-term holiday lets, which are often reserved purely for websites like Airbnb.
Government data also says every one in 37 homes in the area are empty.
This comes at a time when house prices have soared in recent years pricing many locals out of the market.
According to Rightmove, the average house in Brighton and Hove costs £473,000, far higher than the £278,000 UK average.
The plan being drawn up by the Green run council would limit the purchase of second homes only on new build properties, but they would keep the option open to make it a citywide ban.Labour Councillor Gill Williams said: "I brought this motion to Council because we are in dire need of a ban on second home ownership in Brighton & Hove.
“Our city is at the sharp end of the housing crisis. The Greater Brighton area faces a ‘lost generation’ of working age people and families. We are in danger of losing whole classes in our local schools due to the lack of affordable housing pricing people out of the area."
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Marianna Ebel, a Green Party councillor, told the BBC: “We have to do something. We have a housing crisis and thousands of residents are on our housing waiting list.
"When flats and houses are used for short-term holiday lets and second homes, it not only reduces the number of housing units but causes massive problems for neighbours, such as anti-social behaviour.”Although Brighton and Hove would become the first city in the UK to make such a move, other tourist hotspots are making similar plans.
St Ives in Cornwall voted through a similar measure in 2016, but so far has been met with mixed results as the ban on new home purchases has placed more demand on older homes.
Borough councillor Phil Trumper said a three-bedroom house on Church Street, in the heart of the tourist area, would have been £25,000 to £30,000 in the early 90s but will now sell for in excess of £500,000.
Mr Trumper said: “I lived in that part of of the town all my life and we had a proper community down there in the 80s.
“But no one lives down there now. It’s becoming a theme park, basically. And that’s something that we don’t want to happen.”
The Welsh government is also drawing up plans to hike council tax on empty homes by as much as 300%.