The homelessness sector has welcomed the scapping of "punitive" requirements for people seeking temporary accommodation.
Currently, people seeking temporary housing must keep a diary to prove they have attended rental inspections and applied for properties as a requirement to stay in government-funded accommodation.
A statewide change, announced by NSW homelessness minister Rose Jackson on Monday, will see this policy frozen for 12 months.
Homelessness NSW chief executive Trina Jones welcomed the removal of diaries, which she said were required when people were in "the worst crisis of their life".
"People have to demonstrate - often in their first week of homelessness - that they could find up to 10 affordable rentals and proactively show they were looking for these [properties]," she said.
Ms Jones said this often came when people were fleeing domestic violence or experiencing mental health challenges.
She described the current system as "cruel" in a time of zero and one per cent affordable rental vacancies statewide.
"This policy really blamed the person for their homelessness," she said. "Scrapping the diaries is a great step in the right direction."
The change, under Labor, comes after the NSW Coalition Government supported nine of 40 recommendations to improve homelessness in January 2023.
Danielle Whyte of homeless refuge Our Backyard said under current policy, signatures of estate agents had to be be gathered in person for diaries, despite most rental applications and some inspections being done online.
"To ask people to go around to property managers is an onerous activity. People are still applying for rentals, yet there's no rental available. People haven't got the money to pay for rent," she said.
"At the end of the day, the [rental diaries] were achieving nothing."
Regional collaborations coordinator for the Hunter Domestic and Family Violence consortium, Lisa Ronneberg, said the change removed hours of admininstration for staff members in helping people fill out diaries. The change would free up refuges to serve more people.
"The whole sector is pleased. Everyone has been calling for this change for quite some time," she said. "This has taken up a lot of time and it means workers are not able to support others who may need it."
Minister Jackson also announced a two-year renewal of contracts for Specialist Homelessness Service funding across the state to June 2026.
This funding is given to refuges including Carrie's Place in Maitland, and Jenny's Place and Nova for Women and Children in Newcastle.
Ms Ronneberg said increased funding stability would allow refuge workers to create long-term strategies and manage staffing.
"Services will be able to consider what program they can deliver longer term. We know we absolutely need to be working longer term with people on their recovery from domestic and family violence," she said.
She said a larger break - extended from three years to five - between funding applications was welcomed.
"Leading up to that timeframe every three years, everyone is spending a huge amount of time working on the next applications."
While the sector welcomed the changes, experts stress a housing crisis is still far from resolved. According to Homelessness NSW, 57,000 families remain on a waitlist for housing statewide.
"The pathways out of homelessness are significantly constrained by lack of available affordable rentals and social housing," Ms Jones said.
"These are good initiatives but they are not really making a difference to people's [living] situation," Ms Whyte said.
"The problem is there are only a handful of properties available for people in an [affordable] price range."
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