A new housing survey shows housing need on the coast is even higher than it is in London.
Fordham Research was employed by Brighton and Hove Council to carry out a comprehensive investigation.
It discovered housing need in the two towns was twice the national average with more than 15,000 households in unsuitable homes.
The report highlighted two main areas of concern - homes were either too small or in need of major repairs.
Housing cabinet councillor Tehmtan Framroze said: "This confirms the experience of all who are involved with housing issues locally.
"As Brighton and Hove becomes an increasingly popular place to live, it has become more difficult for many local people to get affordable housing that meets their needs.
"Living in unsuitable housing is not merely inconvenient. It has a profound effect on health, educational attainment and employment prospects.
"At a wider level, housing need affects all our lives through its impact on the local economy and the effectiveness of public services."
Coun Framroze said there was no way in which the council could meet the need by providing more than 15,000 affordable homes over the next five years.
He said: "This problem is too big for the council to tackle alone.
The council wants to secure more funding from central government to tackle the problem but says money is not the only answer.
Coun Framroze said: "These findings present a challenge for the public sector, local business, community organisations and the voluntary sector.
"They will have to build partnerships and find new way of addressing the extensive housing problems that affect the lives of thousands of local people."
The research showed the town centre had the worst housing problems with one sixth of all families in housing need.
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