"Somehow we've gotten off base and started thinking that compassion is just to leave people out there and let them do whatever they want to do," Carson told FOX Business' Liz MacDonald.
California Gov. Gavin Newson (D) is asking the Trump administration for federal housing vouchers, but Carson said that shouldn't be the only method.
"One thing that we know that doesn't work is just throwing money at it because the more money you throw at it, the higher the prices go."
"The regulations continue to grow, and you'll never catch up," Carson said on "The Evening Edit." "You're just chasing your tail."
Carson compared diagnosing the cause of the homelessness crisis to practicing medicine.
"You look at the person who has a fever," Carson said. "You don't just treat the fever. You say 'What is causing the fever?' and you go to that. And this is what we've got to do with the housing crisis, or we'll never catch up."
Carson said the Trump administration wants to have federal-, state- and local-level government cooperation when it comes to tackling the homelessness crisis, calling that "the ideal type of situation."
"We have to talk about both an acute phase and a chronic phase," Carson said. "We recognize that you have a whole host of different kinds of reasons for people to be homeless. You have those who are drug-addicted. You have those who have mental problems. You have those who fall on hard times because of a job or family illness, divorce. And so, obviously, one solution does not fit all of them."
Carson said the homelessness crisis in America is causing a health hazard on the streets when people leave things like human waste and medical supplies lying around.
"These are the kinds of things that set up a situation where you can have a major epidemic, so we need to fix it."
"And that means taking people off the street and putting them in a location that is safe, but also a location in which we can provide some of the wraparound services because [it's] not just a matter of getting them off the street," Carson said. "It's a matter of figuring out why you're on the street in the first place."
Carson said he's happy with the work the Trump administration has done so far with local politicians.
"We have to look at the data," Carson said. "We have to look at the evidence and do things based on that."
An estimated 130,000 people are homeless in California, which is more than any other state in America.