It's not only homeowners who are struggling with high interest rates, but renters across Parramatta have been hit with rent increases of more than 16 per cent this year.

People renting a two-bedroom flat in the area have found rents hiked up by 16.4 per cent since last year - a median weekly rent of $320 - according to the Housing NSW Rent and Sales Report 84.

In a three-bedroom home, renters were slugged a 5.9 per cent increase this quarter - a rise of 16.1 per cent for the year.

Western Sydney Minister Barbara Perry said she was concerned by the figures and blamed the banks who continued to charge interest rates above

and beyond the official rate for adding to people's financial stress.

"It's clearly very tough for many homeowners and renters at the moment with many people also feeling the squeeze caused by higher food and petrol prices,'' she said.

"From the feedback I have received from residents housing stress is increasing.

"Growing numbers of home owners are being forced out of their homes and into the rental market where they are slugged with rising rents as landlords attempt to pass on their higher interest costs.''

Ms Perry said the State Government had introduced measures designed to help ease the housing burden including a boost to financial counselling services, temporary housing options, Rent Start to help people enter the private rental market and renters who feel they have been given unfair rent rises can apply to the Consumer Trader Tenancy Tribunal.

But director of the Macarthur Community Forum, Jane McIvor said the options for help make her "blood boil''.

"The thing is that none of these options work,'' she said.

"When there's no houses and rental prices are on the rise there's only so much you can do.

"If people don't have a safe and secure home, health problems rise, mental health problems rise and unemployment rises.''

Ms McIvor said across the south west, temporary accommodation is in high demand and short supply.

"Formule One Motel is full to the brim and we've had to start putting people in a hotel in Appin,'' she said.

"And if there's no house for you to move into, Rent Start is null and void.

"They are auctioning rental properties and they are giving them to the highest bidder.''