Families are sleeping in cars in Dargaville and others are knocking on doors asking people if they know of any available accommodation.
Six families from the Tongan community recently lost rented accommodation because new owners bought and moved into the houses.
The families have been unable to find other rental houses in the Northland west coast town, population about 4300.
Two of the families have been sleeping in their cars.
None of them are homeless because they can not afford to pay rent, Wesley Methodist Church minister Reverend Kuli Fisi'iahi said.
Some have both parents working and all have school-aged children.
Mr Fisi'iahi said he knew of three other families sleeping rough who were not part of the Tongan community.
That could be the tip of the iceberg, Te Tai Tokerau MP Kelvin Davis said after attending a meeting Mr Fisi'iahi called in Dargaville yesterday.
It was held in the Work and Income office and although the media were invited, Work and Income management would not let them in.
Afterwards Mr Fisi'iahi said he wanted the meeting there so Northland District Health Board and other agencies would become involved.
"I heard there was emergency help available, that's why I contacted Work and Income."
Only one of the families in his group qualified for government income support, he said.
"The shortage of housing has led to overcrowding in many cases, and now also to homelessness."
Members of the church and the affected families had walked town looking for vacant houses and to locate the owners.
"We're going out and looking. If the property needs to be fixed up, painted or cleaned, then we can offer our services to do that to make the houses habitable," Mr Fisi'iahi said.
While no immediate outcomes came out of yesterday's meeting, options were aired, he said.
Among them was the short-term possibility of using vacant NorthTec Dargaville campus buildings.
Mr Davis said the reasons for homelessness in Dargaville were "generic", and a sign of the times where working people were living in conditions of poverty.
"My initial concern is helping those families, then it would be good to know how many others are in this predicament," Mr Davis said.
"It's a serious problem and it's not as if the local council or Work and Income can just come up with houses.
"There are any number of short-term options but they all cost money and someone has to take responsibility. That someone is us, the politicians.
"The real solution is for the Government to provide affordable homes."
Mr Davis said education was also crucial - to educate the affected workers about how to buy their own homes; and "financial literacy", how to look after the asset once they bought it.
Kaipara Mayor Greg Gent acknowledged the local problem but said the council - with a debt load double the New Zealand average - could not afford social housing, other than the pensioner housing it already owned.
Mr Gent said the rental shortage was partly due to people moving into the district.
"We're getting the Auckland-drift up here."
Local rental property manager Jill Wilson, from First National, said a range of people were buying houses, many of them locals buying their first home, rather than investors.
Ms Wilson said the rental shortage was also due to stability; there was low unemployment in the district and fewer houses were being vacated.