Once upon a time the "houseless" were called "vagrants" [1]. Due to the associative nature of human pattern recognition, the word "vagrant" acquired a connotation reminiscent of unpleasant experiences involving its referent.

To insulate their communication from this evocative power of language, activists steered institutions toward a new word ("homeless") and the general public eventually followed suit. But word choice does not change the underlying phenomenon, and so "homeless" was fated to acquire the same nasty connotation as its predecessor, and is now getting replaced again.

Note that the literal nature of "homeless/houseless" actually broadens the category, which is kind of cruel to people who are more functional and only temporarily homeless.

[1] And before that, "bums", "indigents" etc.