Northampton Borough Council is spending £50,000 a month on B&Bs and temporary accommodation for homeless households.
A report published ahead of a full cabinet meeting this week says the council has struggled to deal with a "sharp rise" in homelessness in the town.
Figures for August 2017 show the number of homeless households put up in temporary accommodation by the council has doubled to over 200 in the past 18 months, including 87 cases living in B&Bs.
The report says: "Despite officers' best efforts, caseloads have risen sharply and the number of outstanding homelessness decisions has increased to more than 200.
"The problem has been compounded by the Council’s difficulty in recruiting experienced Homelessness Officers to cover for maternity leave and vacant posts."
But the strain on homelessness officers, who on average are dealing with 50 cases each, has been made worse by a backlog of requests by households to review their cases - which often ask to extend their stay in temporary accommodation.
The borough council is now considering outsourcing these reviews to take pressure off their staff.
It comes as opposition leaders yesterday (September 11) called on the council to build "pop-up" prefabricated houses for use as emergency accommodation.
Councillor Sally Beardsworth, leader of the Lib Dems, said: “We believe that it is time for the authority to follow Reading Council and others and use prefabricated units to create a stock of temporary emergency housing which will provide homes for families while they are waiting authority-owned or other social housing”.
“B&B is particularly unsuitable and disruptive for families and at a time of growing homelessness
represents poor value for money within a stretched budget.”
Leader of the Labour Party Jeremy Corbyn also criticised the borough council's efforts to tackle homelessness during a visit to Northampton last week.
Mr Corbyn said: "Councils themselves are not building enough, or most cases they're not building anything.
"The private rented sector is largely unregulated and those who pay the price then are those people who are homeless who cannot get anywhere to live because they can't get the money together for a deposit, they can't afford the rent, or the rents are beyond the local housing allowance level."
Northampton Borough Council will discuss outsourcing the homelessness review system at a cabinet meeting on Wednesday (September 13).