Any kind of affordable housing, provided it's livable, is a good thing, espcially in places with high housing costs and homelessness rates, and places (like Yup's rural railroad towns or much of my own rural native county) where apartments are scarce/absent. Baltimore isn't California, but rents are alot higher than 10 years ago, and homelessness is rising, too. And the City's occupancy-limit-ordinance that forbids landlords from renting any unit--even if it's a full-size multi-bed multi-bathrm house--to more than 4 "unrelated persons" (hello, mandated intrusion into people's personal lives) makes it a little harder for people with neither a spouse/family nor an income above $50-60k a year. There was even a failed attempt during the comp plan update a few years ago to cut that limit down to 2 "unrelated" people per unit, same as in suburban Baltimore County (seperate from and nearly surrounding the independent City)--apparently b/c some older folks in rapidly hipsterizing Hampden got annoyed by the small fraction of young people who were getting rowdy, decided it was time to clear them out, and persuaded a City Council member to try squashing their local ant with a citywide hammer. Nevermind the more effective options of noise-ordinance, health codes, quick police-call for the really rowdy ones, with no collateral damage to totally uninvolved strangers across town who are just trying to make ends meet. Thankfully the amendment was shot down. With market forces and policies both hurting more and more people, and no shortage of folks pushing both, there's a role to play for something like the better boardinghouses.
The two pitfalls I see:
1) Keeping the livability standards up, which most of you have touched on RE: flophouses. Wouldn't broader existing public-health/safety codes & the specific codes already in use for apartments be mostly sufficient in most places, just pared down to omit things not present in the boardinghouse, e.g. kitchen-related codes for units that lack a kitchen? Or tweaked so that the kitchen-related requirements only apply to the building's kitchen and not individual units that don't have their own.
2) Public/NIMBY opposition, a la the SRO/STR issue Whose Yur Planner and Chairman Meow brought up. No matter how boardinghouses or equivalent are packaged and presented, no matter what the standards devised, someone's sooner or later going to bring up flophouses, SRO's, and the specter of "those people", whether they mean it racially or poverty-wise, and you can guarantee someone's going to bring up either drug addicts/dealers or sex offenders. Which means a lot of communities that don't block boardinghouses entirely are going to at least try shunting them off to industrial or commercial areas, down by the highway interchange, or to poor/minority neighborhoods, just like any other proposal for affordable housing.