The plan will add 1000 new transitional housing places to current stock - but only 150 of those will be new builds, with the government either buying or renting the rest.
Auckland woman Andrea Bartlett is on the brink of homelessness - her and her six children have been renting their home for the past two years, but were recently told their landlord wants to sell.
"I have six children who are dependent on me and when I've looked for private rentals I get declined.
"Also the housing list seems to be quite long - I'm a priority A-17 but above that is A-20 so I'm not even at the top of the list."
Bartlett said she had rung multiple places trying to get help, and was at her wits end.
"I've been a really successful renter and pay my bills on time but we're going to be homeless in two weeks because nothing's come up.
"I'm good with money, but yeah it's not enough because I do have six children and yes it was my decision and sometimes we don't make the best decisions but they've all been blessings ... we don't need to be penalised for that."
Bartlett worries every night about becoming homeless - and she's not alone.
The number of people living in motels to stay off the streets has skyrocketed in recent years - in the three months to December the government spent $48 million on emergency accomodation.
Prime Minister Jacinda Ardern today announced $175m of the $300m homelessness action plan would go towards adding 1000 new transitional housing places on top of the 1300 places introduced since the government was formed.
She said living in motels was a 'temporary way of existing'.
"And it doesn't represent an efficient use of taxpayer money."
The 1000 transitional places are projected to include buying approximately 350 to 450 properties, renting 400 properties, creating around 150 spaces in portable housing, and in a small number of cases using unused student accomodation or former motel rooms.
Speaking to Checkpoint, Housing Minister Megan Woods said some of the houses being bought or rented would be new builds, but she couldn't give numbers on how many.
"What we won't be doing is ending existing tenancies on leases we take out - these will not be houses that have previously been in the rental market.
"What we need to do is ensure is that we have places so that we can get people out of motels, that we can get them on a pathway to permanent housing and solutions."
Auckland Action Against Poverty coordinator Ricardo Mernendez March said the plan was a start - but more houses needed to be added to the government stock.
"Of course anything is better than a car, we should not accept that people should be living in cars, but at the end of the day what we need to see is permanent, bold injections of resources into building state housing."
The government said the homelessness action plan was in addition to the permanent housing it's building - other public housing was expected to increase by 1600 homes a year, to about 6400 extra homes by June 2022.
But with more than 14,000 people now on the waitlist for public housing, there's still a long way to go.
Bartlett and her six children have just joined the queue - she said the new builds couldn't come soon enough.