The government will spend $300 million on emergency housing, funding an extra 1400 places around the country, Minister for Social Housing Paula Bennett says.
The money is to go into emergency housing, more support for tenants and more frontline staff.
The funding boost will be enough for up to an extra 1400 places at any one time - 600 in Auckland and the remaining 800 places in areas of high demand around the country.
"In total, we're aiming for more than 8600 places per year, as well as continuing to provide access to alternative accommodation when contracted emergency places are not available," Mrs Bennett said.
She said the government had set up a cross-agency team to secure suitable properties around the country and, in Auckland, build new ones if necessary.
The government was looking at buying and leasing more motels for emergency beds, Mrs Bennett said.
The $300m package included $120m in capital funding to build, buy or lease properties suitable for emergency housing - $100m of this would be as a loan to Housing New Zealand to be paid back over 10 years.
"We have large numbers of new, more permanent, housing coming on stream but that always takes time", she said.
"This is designed to fill the gap in the interim."
Prime Minister John Key acknowledged the housing problem for some New Zealanders had gotten worse.
"Over recent months it's become clear that demand for emergency housing has increased, especially in Auckland.
"So we are looking to meet that demand in a number of ways."
But Mrs Bennett said the funding boost was not an admission there was a housing crisis.
"What it's saying is that there's most certainly challenges out there and some of our most vulnerable feel them.
"Central government hasn't been in this space before, we are the first government to actually step up and actually give [providers] some certainty of funding. We have seen a demand and are unapologetic about actually stepping up and delivering for them."
The work in this package had been going on for some time, she said.
"We have done due diligence as any taxpayer would expect us to, to make sure we are really filling gaps and that we're putting money where it's needed and for the people that need it most.
"We have that information, we have that analysis - we can now go ahead and take this next step."
The loan to Housing New Zealand was specifically for emergency housing, she said.
"To be honest they don't do much in this area, they have community group housing, a few that they rent out to Women's Refuge and others, but in general they are not responsible for new build in emergency housing."
Mrs Bennett said the government was "piggy-backing" on their processes.
"They've got the best processes within government so we have, I have, specifically asked them if they would help in this particular area and so that's what the loan is for, it's quite separate from their permanent build."