Objective: Homelessness among people with a mental illness is a serious issue. The purpose of the present study was to identify the types of housing available for people with a mental illness in the region, to develop an audit tool to assess the housing of patients of the mental health service, and to pilot this audit tool. Methods: Key informants were interviewed to obtain information about the type of housing options available in the Loddon Campaspe Southern Mallee Region, Victoria, Australia. This information was used to develop a survey to audit the housing status of existing patients of the area mental health service. A pilot study using the survey was completed by case managers for 81 patients who were being case managed by the area mental health service Results: There was a wide variety of housing options in the region but housing availability was not evenly distributed. Although most patients lived in owned or rented accommodation, a substantial proportion of patients had difficulties with accessing the required services, the affordability of their housing, uncertainty of tenure or were at risk of violence within their housing. Conclusions: A substantial proportion of patients treated by a rural area mental health service had lived in impoverished housing.