The Dunedin City Council (DCC) will open up a sports ground to campers attending the Ed Sheeran concerts next year, creating an extra 450 accommodation spaces to cope with the influx of visitors.
One high school has also had all of the beds in its hostel snapped up by fans.
Hotels and motels were fully booked even before tickets for Sheeran's three Easter 2018 concerts went on sale, leaving many from out of town desperate for a place to stay.
The DCC is allowing the Dunedin Holiday Park to use the nearby council-owned Tahuna Park sports ground to accommodate additional campervans and tents for 450 people.
DCC recreation, planning and facilities manager Jendi Paterson says the council allows this arrangement for major events like All Black Tests.
The city also opened up accommodation zones around the city for the Rugby World Cup in 2011 and the 2005 Lion's tour.
The community has already benefitted from Sheeran's recently announced March 2018 concerts, with Otago Boys' High School offering up beds in its hostel over that long weekend for $50 a night.
The school was inundated with nearly 500 messages of interest in just a couple of days, with only 150 beds available.
Other Dunedin schools couldn't be reached for comment.
The University of Otago residency halls and colleges won't be providing any rooms because students staying there hold their rooms for the entirety of the year.
Alternative accommodation options include staying in Oamaru, which is around a 90 minute drive away, or Airbnb, which has some rooms going in Dunedin for as little as $50 a night.
It will be the first time Ed Sheeran will play in Dunedin and his first two concerts at Forsyth Barr Stadium on March 29 and March 31 have already sold out.
Ed Sheeran announced on Friday afternoon a third and final show in Dunedin on April 1.
Tickets for that show go on sale June 1.