That's according to a report card from the Housing Trust which measured the three Illawarra councils and Shoalhaven council against five markers.

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These included whether there was a policy in place that addressed affordable housing, a commitment to provide land for such projects and mandating developers make a contribution.

Shoalhaven was given a B, but the Illawarra councils all failed - Wollongong and Shellharbour got Ds while Kiama went to the back of the class with an F.

Housing Trust CEO Michele Adair said the situation was so bad in Kiama that the council's Local Strategic Planning Statement acknowledged the problem of affordability but that there were cheaper housing options in nearby areas.

"The situation was actually worse than what we had expected," Ms Adair said.

"We didn't anticipate that councils like Kiama would so blatantly say 'you can live somewhere else rather than living in our community'.

"That's frankly very shocking for all of the local heroes that are actually going to be the backbone of rebuilding our economies and our lives - the nurses and people's working in retail and tourism and hospitality. To read in a formal council document that Kiama council simply doesn't care was more shocking than we had anticipated."

Lyn Bailey has a roof over her heads thanks to the Housing Trust. She was living with her daughter until they decided to move and so she had to find somewhere else to live.

On a pension that was a struggle; in the line to look at apartments, she'd hear others say they would pay an extra $100 a week to get this home.

She said she was "looking homelessness down the barrel" but the Housing Trust helped her find a small apartment in Shellharbour.

Ms Bailey believed councils could be doing more in the area of affordable housing.

"It is just so necessary," Ms Bailey said.

"They just need to be doing so much more. People like myself, we don't want a castle. I have a one-bedroom unit in a block of 16 and I just love it. It's all I want, it's all I need - I can live stress free there.

"There are so many other people in my situation that need that sort of help."

A Wollongong council spokeswoman said the housing affordability crisis was "a complex issue that requires multiple solutions and input from all levels of government including local, state and federal".

She said council and the state government were developing a two-year trial using vacant land and buildings as temporary accommodation.

"We have a commitment to support improvements to affordable housing in our city," she said.

"In 2017, council entered into a new Memorandum of Understanding with the Federal Government to allow reallocation of federal funds, originally $10.4 million, to assist with the delivery of affordable housing in the city.

"Council resolved to deliver these funds via two streams, the first being an Expression of Interest for not-for-profit Community Housing Providers for proposals to help deliver affordable housing in Wollongong.:

She said $4.3 million was given to the Housing Trust.

Shellharbour Mayor Marianne Saliba said council was "punching above its weight" when it came to releasing new lands and said the majority of the land at Calderwood had been bought by locals.

"As far as affordability is concerned, we don't determine that," she said. "That's determined by the market; we can't help that we live in such a great city that everybody wants to live here."

Kiama council was also contacted for comment.

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