I highly doubt the best long-term policy for a city's residents is to have a housing shortage and for many to live on the street because of natural light concerns.
Homelessness and affordable housing aren't really related in this case. These people can afford and get housing if they wanted to, just not in their preferred area. But it's not like they're gonna just throw their hands in the air and decide to be homeless because they couldn't find a place exactly where they wanted. They'll just move somewhere else they can afford.