Some families are waiting decades for social housing and now is the time to address the issue, an inquiry has been told.
A federal parliamentary inquiry kicked off in Canberra on Tuesday, examining what governments and the not-for-profit and private sectors can do to address homelessness.
The Australian Association of Social Workers told the inquiry successive governments had allowed social housing stock to drop.
With private market houses and units out of reach, social housing is often the only secure tenure available to people on income support.
"Social housing waiting lists are prohibitive and, in some areas, decades long," AASW national president Christine Craik said.
"As the demand increases, there has been a corresponding decrease in government funding.
"This has led to a crisis for those individuals and families seeking shelter and for those services who provide support to the homeless."
Research has shown providing housing first and "wrap-around support", often involving social workers, is a proven way to end homelessness.
The Australian Council of Social Service said a third of homelessness support services were rarely or never able to meet demand last year - well before the COVID-19 pandemic struck.
Deputy chief executive Jacqueline Phillips wants the government to guarantee funding for support groups.
A permanent increase in welfare payments, rent assistance and a boost in social housing would all help tackle homelessness, Ms Phillips said.
Think tank Per Capita said tens of billions of dollars need to be pumped into public housing over the next five years.
The Social Services Department told the inquiry homelessness had remained relatively stable across Australia between 2001 and 2016.
But it said major cities had seen the largest growth in homelessness, with more than half of the country's homeless living in the big cities.
More than 115,000 Australians were classified as homeless in the 2016 census.
This included people in overcrowded homes, temporary housing or rough sleepers.