Tourist videos showed Rotorua at its finest, but when tourism dried up, many locals lost their jobs, livelihoods and homes.
Fenton St, which runs through the central city, is now home for many of those families, crammed into emergency housing.
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Mayor Steve Chadwick said the city was trying to support those who needed it.
"We want to look after our own people who through Covid, loss of their jobs, going part time, or rental increases, haven't been able to afford to live where they lived decently before and we want to house those as a top priority."
But with no clear plan for their future, some residents are over it.
"It's having a huge effect, especially on people in this area," Trevor Newbrook of Restore Rotorua said.
"There are 24 motels down Fenton St and that's the golden mile of Rotorua - now called the MSD mile. Twenty-four motels that are full of emergency housing residents and we're talking about drug dealing, family violence, all those sorts of things."
Newbrook thinks there needs to be a sinking lid policy, so when suitable housing becomes available and families move out of motels, others don't fill the rooms left vacant.
"Is it a suitable place for families to be living in a little motel unit all day, concrete yard, nowhere to play, one washing machine for 20 or 30 units. How does it affect the mental health of these people?"
Chadwick said he was aware of the issue but the 6000 homes required weren't going to be built overnight.
The Ministry of Social Development says it's already reduced the number of people waiting for emergency housing.
"Now our focus is very much on supporting those in emergency housing with employment and that's going really well," regional commissioner Mike Bryant said.
Community group Rotorua Trust is confident the city can bounce back.
"I think in Rotorua there is the opportunity to make a couple of phone calls and you can get something done," the trust's grant manager Jackie McCullough said.
The first task is to return the golden mile to its pre-pandemic glory, along with the rest of the region.
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