Trust operations manager Ange Tepania said out of the seven families currently in their accommodation, three were working families.
"One family we just got in were managing because they were living in an extended family rental, so the cost was easier but they had to move because the landlord required the house back. They've been searching but haven't been able to find one," she said.
Ms Tepania said an average two-bedroom home in Whangarei was $250 per week or more, so families were struggling to find affordable homes.
She said when families had been to house viewings there were often 15 others looking and a lack of previous rental history, or bad credit, put them on the bottom of the list.
Mr Whale said the high demand meant the trust was having to turn away several families per week.
In October last year, Ms Tepania told the Advocate they were turning away up to five families per week, but that had now increased to seven to 10 families per week.
"We don't have a waiting list anymore because it's just giving false expectations to have up to 40 people on a waiting list," Mr Whale said.
He said two years ago the trust could house about 75 per cent of tenants within six weeks in Housing New Zealand homes - now it's less than 10 per cent.
"We used to have people stay for about six weeks and now it's more like eight to 12 weeks," said Mr Whale.
Ms Tepania said in the last three to four months, of the five families listed on Housing New Zealand's register only one had found housing.
Mr Whale said families turned away by the trust were finding any accommodation they could. "Some are living in tents in family members' backyards, some are in cars, some are couch-surfing."
Ms Tepania said it was "heartbreaking" to turn families away.
The trust operates two properties in Whangarei - a seven-unit complex for families with children, and a four-bedroom house that could accommodate up to six solo men.
Mr Whale said the trust could only house a maximum of 100 families per year.
