The Salvation Army is comparing the country's housing crisis to the "perfect storm" and expects the situation to get even worse over the next year.

File photo Photo: RNZ / Nate McKinnon

The organisation has written a post-election briefing to the Housing Minister Megan Woods, citing historically low-interest rates, a stalled private rental market and not enough new houses as drivers of the crisis.

It also believed an increasing population due to Covid-19 border closures was partly to blame and wanted a "more measured immigration policy" which is aligned to New Zealand's capacity to build more housing.

The Salvation Army called for eight policy reforms, which included the government addressing the impact of the Reserve Bank's monetary policy, implementing some form of capital or wealth tax and partnering with NGOs to provide social and emergency housing.

It also wanted a review of the operational and financial sustainability and effectiveness of the government's housing provider Kāinga Ora.

Salvation Army social housing director Greg Foster said the demand for housing was huge, but there was no supply.

"We just opened 22 units in Westgate about a month ago and we've had hundreds of people applying for those 22 places," he said.

"This storm is entirely the creation of poor housing policies of the past as well as related monetary and fiscal policies of the present', he said.

Foster said the organisation could not see an end in sight to the crisis and expected things to worsen for at least the next 12 to 18 months.

"Rents and the price of affordable housing are likely to continue to rise faster than incomes, and the social housing waiting list will grow longer still," he said.

He warned a generation of young New Zealanders could be scarred by their current experiences of poor and inadequate housing.

"The Salvation Army has built over a hundred social houses in the past 12 months and will be building more in the next 12 months with the support of the government.

"Nonetheless, I feel that they need to do even more to support the sector to build more social and affordable housing at this time."