If you read the popular American literature of the early 20th century (autors like OHenry and damon Runyon) you will see references to “flop” houses. they were basically rooming houses, in slum areas, where a poor person could rent a bed for the night. These were popular with drunks, and they served a function: the drunk got a reasonably safe place to sleep (for 25 cents or so), and the streets were free of homeless.
These flophouses faded away in the 1970’s…maybe it is time to allow them to operate again? Couldyou make money running a flophouse?
Daily and weekly (“transient”) hotels and SROs are alive and well in San Francisco, if you don’t mind filth, crime, and hazards to life and limb. The incredibly small profit margin is supplied by ridiculously inflated rates and an absolute minimum of maintenance. If that doesn’t do the trick, there’s always arson.
First, there’s inflation. A quarter, in the “dirty thirties”, would buy you a dinner, perhaps with a beer on the side. So a 25¢ “flophouse” would be roughly the equivalent of a modern “transient hotel” renting rooms at around $25 to $30 a night. While some drunks may be able to come up with that kind of cash on a daily basis, the majority would rather spend it on Thunderbird.
Second, just because Damon Runyan doesn’t mention homeless people in his stories doesn’t mean they didn’t exist. I’ll be willing to lay odds that New York has had a sizeable proportion of homeless citizens ever since the Indians were disposessed and left trying to find a place where they could sleep for the night in exchange for a few beads.
Third, the “reasonably safe” aspect of flophouses is generally over-rated. Cheap, loose and non-functional locks are the abiding hallmarks of the poorly maintained rooming house, even today. Some street people even claim they avoid such places because they feel less secure than bunking in an out-of-sight alleyway.
Jesus said “The poor ye have always”, and the homeless who sleep on the streets are just those too poor to afford a flophouse at the going rate. 
We’ve still got 'em in Chicago. Here, they do double duty as really, really, low-rent “apartments” for pseudo-homeless people. Of course, they don’t have kitchens or sometimes even bathrooms. If you’re lucky, you bring your own hot plate, and the toilet is down the hall. There’s one I know of in Roger’s Park which has monthly rates of $250. (A real one-bedroom apartment would run between $500 - $750 in that neighborhood.) It’s a really nasty place, with lots of theft, assault, drug addicts and prostitution.
Keep in mind, also, that many ‘flophouses’ back in the day didn’t even have rooms, but perhaps just partitions, or even bunks in a large room. Such things would probably be against the health code today. In a cheap hotel you still had your own room, and maybe a bath, but in a flophouse you didn’t even have that.
Exactly. Where I work, there are a great deal of these and they are set up exactly like any other motel. You can’t really tell the difference until you go inside, and it’s clear people live there.
Also, if you’ve read Nickel & Dimed, the author used similar establishments as housing on a few occasions.