PSO chief executive Jo Rowe said increase in rent had a significant impact on the organisation’s clients who had low and or limited incomes.
"We’ve seen a significant increase in people accessing our financial mentoring service and our food bank as a result of this," Ms Rowe said.
"Most people reaching out are struggling to meet their basic essential living costs and this means they have no money left for food or power."
Some people had to relinquish their rental accommodation because they could not afford it.
"More affordable housing is needed, and quickly."
Many PSO clients spent more than 40% of their income on rent and in some cases it was more than 50%, Ms Rowe said.
"Some family homes are renting for upward of $600 per week which is unsustainable and creates significant distress and hardship."
Housing was a basic human right and changes needed to be made, she said.
"Community housing providers need access to more funding sources, such as grants and low-interest loans to enable more homes to be built where the need is."
Ms Rowe said the Government could increase its accommodation supplement in line with rental prices, and lean into its housing acceleration fund to speed up the pace and scale of housing.
Kainga Ora properties could be subdivided to create additional housing, and a concept for longer-term rentals could be explored, she said.
She suggested the Dunedin City Council partner with private sector investors, community housing agencies, Kainga Ora and others to create a "housing strategy" for the city.
It could also increase funding to the Consumer Electricity Fund to help residents struggling to pay their power bill and change the criteria from every five years to yearly, she said.
"Every person deserves a safe and healthy place to live."
A council spokesman said the council was working to deliver more housing for Dunedin and the effort was already starting to show results.
It was identifying new areas of land suitable for development and working with developers to resolve appeals against the second-generation district plan (2GP).
"This work is nearly complete and will result in hundreds of new homes across our city."
Staff were working closely with Kainga Ora to encourage the conversion of the GoBus site in Princes St into new housing, and looked to increase both the number and quality of our own community housing stock.
The housing action plan had also been developed with stakeholders from across the city, and aimed to provide for a mix of new, healthy, affordable and accessible housing.
"We are also employing more building inspectors and other Building Services staff to minimise any delays in consenting at our end.
"The requirements of the consent process are set by the Building Act, and we have to comply, but we recognise delays cause frustration and we’re doing what we can to make sure we’re not the problem."
