One Government agency is losing income due to its state-owned houses sitting empty in Whangarei while another has paid hundreds of thousands of dollars for homeless people to live in motels.

Housing NZ has 22 empty properties in Whangarei, with most contaminated by methamphetamine and some empty almost a year.

The housing shortage in Whangarei alone resulted in the Ministry of Social Development (MSD) stumping up $271,000 in the three months ending March 31 for people to live in temporary accommodation.

Throughout Northland during that time, 477 extendable weekly Emergency Housing Special Needs Grants (SNG) were made by MSD to the value of $377,343, putting 130 signatory clients representing families as well as individuals into short term accommodation, often motels.

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"Our goal is to support people into long-term, sustainable housing," MSD deputy chief executive housing, Scott Gallacher said.

MSD, which includes Work and Income, manages the applications and assignment of houses for Housing New Zealand (HNZ).

But HNZ has 22 empty properties in Whangarei and says a heavy work schedule has meant long delays in its contractors meeting the demand for the sometimes specialist repairs. Some of the 22 houses have been empty for nearly a year.

"These are vacant mainly due to meth [methamphetamine] decontamination or because they are in need of repair - minor to major," regional manager HNZ Neil Adams said.

"They will return to the letting pool as soon as possible."

MSD said it is "working with HNZ to ensure that vacant housing stock is remediated and returned to the letting pool as quickly as possible".

But one example of the gap between need and availability is a two bedroom house in Selwyn Ave which had been virtually gutted because of the high level of contamination from the drug methamphetamine also called 'P'.

"It was so badly contaminated by meth it will take major repairs to bring back it to a lettable standard," Mr Adams said.

"The estimated cost is in excess of $50,000 and the date, at this stage, is July this year."

The house - the exterior of which appears in good condition, with a private, sunny, fenced yard - has been vacant for about nine months after its internal wall cladding and utilities were ripped out, say neighbours.

Having only two bedrooms, it would be unlikely to be go to a family with more than two children, unless in exceptional circumstances.

MSD describes having more than two children per room as "overcrowding".

In February this year, the Advocate reported Work and Income was shelling out for nine families to stay at Kamo Motel while waiting for state houses to become available.

The agency was paying the motel $3175 per week for three families alone, and in the five months up until then spent more than $33,000 on two rooms occupied by a mother and her five children.

At edition time the Advocate was waiting for a response from HNZ about whether it would call for tenders or new contracts to help clear the backlog of work.