The Government is spending $25,000 a week in Northland to pay for homeless people to stay in motels or backpackers.

The Ministry of Social Development spent $1.33 million providing 1697 people a grant for emergency housing in Northland between July 2016 and June 2017.

The one-year-old special grants are for people "in crisis" who do not have anywhere to stay at all. The grants allow people to stay in an approved motel or backpackers for seven nights while they look for temporary or more permanent housing.

Adrian Whale, chairman of Tai Tokerau Emergency Housing Trust, said it was not a surprise to hear the extent of emergency housing numbers in Northland.

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"It gets people out of cars or caravans which is great, but it does nothing in terms of the long-term wellbeing of people. We've always said we need to build more houses," Mr Whale said.

Reported quarterly by MSD, the number of grants issued has almost halved between the December 2016 quarter (597) and the June 2017 quarter (323).

"It's certainly not our experience that the numbers are going down through our doors," Mr Whale said.

Tai Tokerau Trust owns 15 former motel units capable of accommodating up to 55 people at a time. He said last year the organisation had 287 applications for housing.

The trust employs social workers who work with and for tenants to help them get into a home of their own, and try secure private rentals for them to move into.

"These are the best stories. People are so excited when they get into their own place. It gives them a chance to dream again. For most of them it's having a settled place for their kids - once you get housing right you can education and health right."

"Homelessness is not the way life should be lived in New Zealand."

There was no limit on the number of times someone could be given a grant, but Alfred Ngaro, Associate Minister for Social Housing, said the grant was intended to only be available once in a 52-week period.

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Nationwide, emergency housing grants have almost tripled in value since September 2016, to a cost of $12.6m during April, May and June this year - $140,000 per day.

Mr Ngaro said the Government spent $6m a day helping 310,000 people with housing costs, mainly in accommodation supplements and rent subsidies. He said emergency housing costs were 2.3 per cent of the total.

"Motels are not ideal but they're better than people sleeping in cars and on the street. It's also not the only emergency housing we provide - we're building up our supply of transitional housing too," Mr Ngaro said.

"This innovative new approach sees people given not only a place to stay but more importantly the wrap-around support they need to get back on their feet and to find somewhere to live."

Mr Ngaro said the demand for the emergency housing grant had started to fall recently, partly because of more transitional housing.