The stay-at-home mother of four, whose husband works as a disability support worker, said she reached the end of her tether in 2021 as the long lockdown of that year settled in.

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The McDougals were expecting their fourth child and were already filling out their Foothills Road home, plus the roof leaked whenever it rained.

"It would fully leak downstairs, though light fixtures, it wasn't a very well kept property," she said.

"Every day I was looking at the websites and putting our names down."

Many of the properties the family would apply for were leased before a viewing could be arranged and in one case, the family had to wait 45 minutes at their scheduled viewing time due to the overwhelming demand from roughly 50 families.

After years of constantly being ready to pack up their belongings with only a few weeks notice - Mrs McDougal said it was common practice for landlords to break the lease due to owners moving back in or wanting to sell the property - the toll was starting to wear on the whole family.

"We were struggling to survive in the Illawarra," Mrs McDougal said. "It got to the point where we were having to look outside the Illawarra. It felt like we were getting kicked out."

Thankfully, the family was thrown a lifeline, and were able to secure a subsidised affordable housing terrace in the Housing Trust's Robert Street Corrimal development.

But the McDougals are one of the lucky ones. The housing crisis in the Illawarra has morphed into a housing emergency.

A lack of affordable housing for key workers is the number one issue facing Illawarra businesses, over 20,000 households are currently in housing stress and it is estimated the region is facing an affordable housing shortfall of over 10,000 dwellings by 2041.

As more and more families on lower and middle incomes are pushed into housing stress, the amount of affordable housing in the region is going backwards, with the total and proportional number of social housing dropping in all LGAs in the Illawarra and Shoalhaven.

Wollongong lost 525 social housing dwellings in the five years to 2021, and current waitlists are over 10 years.

A new report hopes to address this, and encourage the four councils in the region to commit to taking action so that families such as the McDouglas don't have to rely on luck to put a roof over their heads.

Developed by Bulli-based town planning firm Judith Stubbs and Associates on behalf of Business Illawarra and a range of community organisations, the report identifies four modes of interventions that councils can take now, within their existing powers, to deliver affordable housing in their areas.

As a starting point, the report identifies that when it comes to affordable housing for key workers, governments cannot leave it to the private sector.

"Around 85-90 per cent of affordable housing need is unlikely to be met by the private housing market," the report highlights.

"A full suite of responses by government, the private and community sector and the wider community are vital if there is to be any impact on affordable housing provisions in this market context."

Ranging from "limited" to "direct" market intervention, the report outlines an array of levers that local governments can pull now to deliver affordable housing.

These range from light touch strategies such as facilitating "meantime use" of existing facilities such as aged care centres waiting to be redeveloped - as being done by Warrigal Aged Care in Warilla - and allowing secondary dwellings such as 'tiny homes' on larger blocks of land up to direct intervention such as delivering affordable housing on publicly owned land - including open-air council carparks in prime CBD spots - and mandating affordable housing in new developments, something not currently done on a broad scale anywhere in the region.

Business Illawarra executive director Adam Zarth said the region was already experiencing the worst of the housing crisis, but that there are actions governments can take.

"We knew that the housing challenge key workers face is particularly acute in our region, where they spend on average 40% of their income on rent, compared against the 30% national average," he said.

"Today we have articulated the actions that each of us can take to address this issue, which is hampering economic growth and exacerbating difficult trading conditions for key sectors including hospitality, human services, retail and construction."

At the state government level, the report advocates for reform of the planning process by speeding up the development application process and modifying the state planning policy to create high density hubs near public transport. Chair of the Illawarra chapter of the Property Council Jennifer Macquarie said these changes would enable more housing to be delivered where it is needed most.

"The current planning system is overly complex and in dire need of reform," she said. "The state government has recently taken some welcome steps that will have a positive impact in our region, but in this report we are urging them to go further."

For the private sector, including property developers and larger employers, making affordable housing part of major developments would enable the sector to lead on the issue while addressing staff shortages due to a lack of appropriate housing.

Warrigal CEO Jenni Hutchins said it was something her organisation was well aware of.

"My organisation is now providing housing for our workers, so we know well the impact the current housing crisis is having," she said. Our staff support the most vulnerable members of the community and work in shifts, so it is imperative that we can provide safe, local accommodation to meet their needs."

The report also identifies areas in Illawarra and the Wollongong LGA in particular that would be appropriate for increased density, including in Warrawong, Corrimal, Oak Flats and Kiama. In these areas where community opposition has been a factor in limiting density - such as with the Corrimal Coke Works - the attached advocacy report outlines the role of regional organisations in "increasing community acceptance and reducing community opposition" to low cost and affordable housing.

MMJ real estate business operations manager Natalie Allan - who was involved in the creation of the report - said there was a role for the wider community to be engaged with advocating for appropriate areas of increased density.

"There is a pivotal role to be played in community education and engagement to overcome concerns surrounding infill development. By focusing on selecting appropriate areas with proximity to transportation and essential services, we can ensure well-planned growth that serves the best interests of the community."

Having seen the difference a secure, affordable home has made for her family, Mrs McDougal exhorted all players to contribute.

"[Housing] is a basic human need," she said. "Invest as much as you can, because you never know whose life you are going to save."

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