With few tourists the area's summer population had dipped to about the level it was in the 1960s and 70s, Gray said.
"The tourist industry and the fishing industry are sort of on hold."
Kaikoura's main centre was "a ghost town," Dwayne Fussell, who owns Coastal Sports surf shop, said.
"Our turnover's half of what it should be. We make 90 per cent of our income through summer. We're normally open 9 o'clock to 8 o'clock this time of year, but there's just nobody around town after 4 o'clock."
Residents usually decorated their homes, but this year many houses were without festive trimmings a little over a week before Christmas, he said.
"I'm starting to see a few trees up. I think everyone's a couple weeks behind the 8 ball this year though. Christmas has kind of snuck up on us, just because there's so much else going on."
The supermarket was running low on hams and turkeys, Fussell said.
Yet despite the struggles facing the town, Gray told the Herald on Sunday, there was a sense of "quiet resilence".
"Last weekend in town we had a short notice market day on the streets that went very well and everyone's still quite buoyant, happy. Businesses are working closer together.
"There's a hell of a lot of support coming in for the students, the schools. Gifts are coming in. It's been fantastic."
Gifts donated by different companies and groups would be handed out to all the local kids on December 19 at St Joseph's School, Gray said.
He hoped residents would get more into the festive spirit closer to Christmas.
"I think you will find that on the day the town will be quite abuzz with the locals out and about."
St Paul's Presbyterian church minister Alistair McNaughton said many residents whose livelihoods depended on vistors were facing "a huge loss of income".
"It's very much a tourist dependent economy. We're still trying to figure out what the new normal looks like."
McNaughton and leaders from other local churches were organising combined Christmas church services and a community lunch to lift locals' spirits. People from all walks of life were welcome "whether people are religious or non-religious or whatever".
"I think people are hungry for community. I there's going to be a lot of people looking for some hope and community this Christmas."