This is a problem that will only get worse, and it's mainly due to housing prices.
When I was a kid, homelessness wasn't a thing where I grew up. It is now though. So I thought "what changed?" What changed was we used to have ghetto apartments downtown, which would set their rental rates at exactly the same as what welfare would pay for your rent. So the welfare bums all had a place to stay in a shitty ghetto apartment.
As real estate prices and demand started to soar, these ghetto apartment landlords found they could raise the rental rates above the welfare rates, and still fill rooms. And thus the tent cities were born.
Closing down all the mental asylums didn't help either...