There are levels of homelessness.
The first level is one where you don't have permanent shelter. Maybe you're staying on a friend's couch or in your sibling's basemenet. But not long term. You may have several such situations and bounce between them. These arrangemenets tend to be temporary and are triggered by the loss of a job or rising rent or divorce or a number of other factors. These people are larely invisible.
The next level of homelessness is when you're exhausted your temporary options and you end up living in your car. You are likely still employed and need your car to get to and from work (because America). This too is a temporary situation. Towns and cities don't like people living in cars. You may get harassed by police. You may get towed. Your car may just stop working and you can't affrod to repair it. On top of that, you may have a bunch of parking violations you can't afford. You may have to deal with crime (eg people breaking into your car and stealing your stuff). These people are a little more visible but are still mostly invisible. Like I've seen cars people are clearly living in but my guess is that 95% of people don't see it.
The third level is where you've lost your car and now you're living on the streets. This is the first truly visible level of homelessness. This experience is traumatic and dangerous. This is where you may start self-medicating (eg drugs, alcohol). It's more difficult to hold down a job so you may lose that too. Crime will affect your daily life. You will be harassed by the police who will randomly move you somewhere else to get you temporarily out of sight. Such people will tend to find some form of community for self-protection, which is why you have encampments.
The last level is where you've been on the street so long that you have serious medical and mental health issues. You may well have substance abuse issues too. You likely will have suffered or at least witnessed serious violent crime. The self-medicating continues. At this point it is incredibly hard to come back from this.
My point here is that when people talk about homelessness they only talk about visible homelessness (ie the last 2 levels). But the problems begin way before then. It starts with a lack of housing security.
The most important thing to do for homeless people is to find them somewhere to live. It's not a shelter. Those have their own dangers and issues. This is what people mean when they talk about a "housing first" policy towards homelessness.
We, in the US, live in the richest country on Earth. There is absolutely no reason why we can't feed and house and provide medical care for every man, woman and child in this country. But we don't because some people don't want to give anything to other people. Some think it'll somehow "encourage" homeless people and stop them from being "lazy".
Instead we pour billions of dollars into an incredibly ineffective and highly militarized police force. Homelessness and poverty breeds crime. The only way to address that is to address the underlying cause. A lot of places simply ship their homeless to coastal blue states.
Just this week, NYC agreed to pay a man $135,000 in settlement after an NYPD officer decided to drag him out of a mostly empty subway car for having a bag on the seat and then lie about what happened [1]. That officer faced no disciplinary action and still works for the NYPD.
The worst thing to happen in the West is the financialization of the housing market. Everybody treats housing as an investment. We've created an incentive to make housing more expensive for the less fortunate. We create policies to make housing unaffordable. This is by design at this point.
[1]: https://pix11.com/news/local-news/man-dragged-from-train-by-...