A friend of mine spent some time living in homeless shelters. Even having one room mate was a problem at times, as many of the people there have mental issues (my friend included).

We need tiers of low cost housing. Some people could make a communal space work, they would need to be able to vote to kick people out. People who are difficult to deal with need their own place, maybe a less dystopian form of mental institute. More like a dorm with mental services and security.