Social agencies say a shortage of state houses in areas of most need is a crisis for low income families which the Government needs to deal with.
Figures released to ONE News show Housing New Zealand has fewer homes on its books now than it did five years ago.
The figures show the state landlord has just over 67, 245 homes on its books, compared to 69,717 in 2011.
The Salvation Army says low income families are living in substandard conditions because Housing NZ doesn't have enough houses where there's most need.
"The Government needs to have a long-term view that addresses the crisis that is now, but also looks to ensure that the crisis doesn't continue into the future," says Sue Hay of the Salvation Army.
"There needs to be more housing. We have 15,000 to 20,000 houses short in Auckland."
But in a startling admission, Housing NZ says it has no idea how many homes are needed.
"In terms of the end number, we don't as such. But we are looking to make sure that our portfolio's fit for purpose," says Leonie Freeman of Housing NZ.
Since 2011, Housing NZ has bought 724 properties. It's built another 805, but it has also sold more than 1851 homes.
"Most of that has really been around trying to make sure we have the right houses in the right place. So a lot of the areas where we've reduced the numbers have largely been in the regions where we don't have so much demand," Ms Freeman says.
And it's smaller homes that people want, not the traditional three-bedroom homes of old.
Ms Freeman says a new development launched last week sees 11 houses on a site that was originally occupied by four old houses.