Welcome to the "Stupid Questions" thread! Feel free to ask any questions, regardless of whether they seem obvious, tangential, silly, or what-have-you. Don't be shy - everyone has gaps in their knowledge, and the goal here is to help reduce them.
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It seems to me that a major factor contributing to the homelessness crisis in California is that there is a legal floor on the quality of a house that can be built, occupied, or rented. That legal floor is the lowest-rung on the ladder out of homelessness and in California its cost makes it too high for a lot of people to reach. Other countries deal with this by not having such a floor, which results in shantytowns and such. Those have their own significant problems, but it isn't obvious to me that those problems would be worse (for e.g. California) than widespread homelessness. Am I missing something I should be considering?
California adopted a "Housing First" policy several years ago. The number of people experiencing homelessness continued to rise thereafter. Much of the problem seems to be that there just aren't a lot of homes to be had, because it is time-consuming and expensive to make them (and/or illegal to make them quickly and cheaply).