A lack of hostels could be deterring backpackers from visiting and filling staff shortages across the city.
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Swedish visitor Rebecca Mansson said the absence of affordable accommodation in Warrnambool - due to both hostel and motel closures and at-capacity caravan parks - had turned her friends away from venturing down to the coastal city situated at the end of the Great Ocean Road.
"I'm currently backpacking on a gap year before I start my studies and I came to Australia 11 weeks ago," she said.
"I've done the east coast and I've been travelling down, but I realised it was really expensive here and travelling and changing homes every third day was very exhausting.
"I decided I'd make some money and settle down a little bit.
"I had a friend who had a job as a stablehand at a racecourse and recommended it, so I found this job in Warrnambool, applied and got a message back saying they'd love to meet me.
"I booked a train here, but it was a bit anxiety-inducing because I only booked one night at a motel and I wondered what would happen if I got the job but had nowhere to stay.
"I was looking to stay in a hostel for a couple of nights to give me time to get on my feet.
"Luckily I posted to Facebook and got three responses, so I'm looking at a room to rent this afternoon.
"The thing is, there are people to stay with and places to stay here, but the issue is you don't know that before you get here which makes people not want to come here and take the chance."
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She said many of her friends had chosen to stay in more accommodating coastal destinations.
"I have a couple of friends who are doing the Great Ocean Road, I told them I was going to be at the end of it and they could visit me, but I discovered they weren't going all the way to Warrnambool," Ms Mansson said.
"Then I had other friends going down this way but turning away earlier. I had other friends going through the Great Ocean Road to Adelaide but not stopping here.
"It's hard for Warrnambool to be a tourist destination if people are travelling here and needing a hostel to stay in.
"Unless you have a car you can sleep in, you end up going to other places and turning around earlier."
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