Mary Lou McDonald has said she 'cannot fathom' why the Government is pushing ahead with ending the eviction ban.
The Sinn Féin leader was speaking as her party is set to put forward a motion in the Dáil to retain the ban next week.
The eviction moratorium is set to end from March 31st.
Speaking to On The Record in Washington DC, Deputy McDonald said there is no emergency capacity available.
"This is a most, most serious situation and for the life of me I cannot fathom how or why the Government is proceeding in this way," she said.
"It's very clear now, because the local authorities have made clear, that they don't have emergency capacity.
"The Residential Tenancies Board has given us the figures for the last three months of last year; almost 5,000 notices to quit.
"So this is a really, really worrying time for so many families".
'There is still time'
Deputy McDonald said the Government can still reverse its decision.
"Nobody in Government can answer the simple question that we've asked repeatedly: where do these families go?" she said.
"There is no answer to that.
"There is still time for Government to do the right thing - and I believe that now that they have full and complete information... the Government needs to row back on this.
"They simply need to reverse this decision".
Ms McDonald said everyone with an interest in the success of peace wants Northern Ireland's political institutions back up and running.
She said she understands the DUP want time to consider the so-called Windsor Framework deal.
"I think it is to be expected, in fact, that everybody with an interest in the success of our peace process would have a strong view and a strong appetite for politics and leadership to resume again," she said.
"The DUP have said they need some time; I don't think that's unreasonable - but I also know that the deal has been struck, the clarity that they require.
"We have some points of clarification ourselves that we'll be seeking out, but we can do that work whilst having a functioning assembly and a functioning executive".
Asked if a vote in Britain's House of Commons next week to ratify the framework may be unhelpful, Ms McDonald said they can't wait forever.
"There has to be a sense of reason and rationality here, the world can't stand still," she said.
"We have to get on with things.
"The issues around the Protocol were subject to a negotiation between London and the European Commission - those were the negotiating parties.
"They have struck their deal and they will now ratify their deal.
"Really there is no excuse now remaining, if there ever was one, for the DUP not to go back in and not to work the power-sharing institutions".
Deputy McDonald said it would be "an incredibly foolish, lost opportunity" if Stormont was not back running by the time US President Joe Biden visits the island of Ireland.
"The eyes of the world at this point in time are on the North of Ireland," she said.
"There is huge international goodwill, a huge appetite for progress.
"Everybody wants to be helpful, everybody wants to make progress - so why would you blow that?
"So I'm hopeful that the DUP, that Jeffrey Donaldson and his colleagues, will do the right thing," she added.
Listen back to the full interview below: