Melbourne City Council has conceded it is powerless to stop unscrupulous landlords and tenants from creating the same slum-like housing conditions in the CBD's high-rises that contributed to the Docklands apartment tower blaze last year.

Extraordinary images obtained by The Sunday Age reveal that up to a dozen overseas students and suspected illegal workers had been crammed into two-bedroom apartments in the Lacrosse tower on Latrobe Street.

Some residents were sleeping on balconies in Lacrosse tower.

Photographs taken after the fire show residents were also sleeping on mattresses on open-air balconies, while some living rooms had been partitioned with curtains to accommodate more people.

The Sunday Age understands that Asian students and workers are being enticed by greedy operators who advertise beds for rent on accommodation sites including AirBnB, Gumtree and Chinese-language websites.