At least five motels in the city halved their nightly rates during the coronavirus pandemic to house hundreds of people referred to them through local services after health restrictions emptied tourists from rooms.

A combination of support from charities like Brophy and the Salvation Army, an increased JobSeeker payment and compromise from the moteliers has allowed the arrangement to work.

For some, like former rough sleeper Jeffery, who had a room at the Mahogany Motel for six months, the accommodation has been a turning point.

More than 100 others stayed at the motel for shorter periods.

"It made me feel like I had friends, people who actually cared, just to be in a comfy bed and be able to have a shower," Jeffery, who did not want his last name published, said.

He grew up in Warrnambool and before the pandemic he slept in a swag at the city's beach, using caravan parks and the ocean to wash.

Jeffery said a sequence of events led up to him becoming homeless, an injury 15 years ago, losing work, heartache after his mother died and unaffordable rent when a housemate vacated the last Warrnambool address he lived at.

"I couldn't get a rental property anywhere," he said. "There's 20 or 30 people going for the same property and unless you're working they really don't want to know you."

Jeffery said he had also waited for social housing for three years. But his fortunes significantly turned at the motel and he secured a job as a farmhand at Cobden and bought a car.

"If I was still in my swag down the sand dunes I wouldn't have come across the opportunity I did," Jeffery said.

Mahogany Motel owners John and Sue Colbey said they had seen residents like Jeffery change.

"I've never seen him so happy, when he came here he had his head down all the time," Mr Colbey said.

The couple has been grateful for the income, which kept the motel open, but like other providers will stop offering discounted rates as tourists return for summer holidays.

"We've put up with a lot but you feel sorry for the ones who need it," Ms Colbey said.

Motel Warrnambool co-owner Carol Quick is also ending the arrangement to house people at-risk of homelessness after having up to 60 people stay.

"Like most motels we are hoping it is going to be a good season," she said.

"It is also not easy handling some of these people, they tend to be those who are on the fringe, who have mental health issues as well.

"There definitely needs to be some sort of social housing or somewhere for these people to go."

Brophy Family and Youth Services team leader Leah McDonald said the service currently had about 30 people in motels set to lose their accommodation.

Ms McDonald said it highlighted a bigger issue of limited social and affordable housing.

"There's about five affordable rentals in Warrnambool at the moment," she said.

Ms McDonald said the motel deals were "fantastic while they lasted".

"It allows the person to settle, it allows them to get services onboard. We have to have them safe before anyone can do any work," she said.

With a referral from the charities, residents paid $350 a week, which Brophy in some cases helped cover, but Ms McDonald said without the increase to JobSeeker people would not have been able to self-fund their accommodation.

"Being homeless is hugely expensive," she said.

Jeffery said the weekly $350 "wears you" when he knew he could pay the equivalent or less if he secured an affordable rental or sharehouse lease.

"I hope to maybe find housing closer to where I'm working," he said of his plans now. "If not I really don't know, it might be back to my swag out near the bush. I don't want to lose this job, it's the only thing keeping me sane and afloat."

Dale, another longer-term resident at Mahogany Motel with his partner Deborah, has lived in insecure housing for 10 years and was couch surfing in Portland before the pandemic.

Dale said he believed John and Sue deserved an award for their generosity, with the couple planning to allow him to stay a little longer.

"Without them it would have been even harder," he said.

"There must be a landlord out there somewhere in Warrnambool who's willing to give us a fair go."

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