Authorities said the suspect wrecked the Ford Taurus at a hydrant in the 3300 block of N. Edloft Avenue near Huntington Drive about 6 p.m.
Firefighters arrived quickly, but could not turn it off due to the valve's depth underground.
Tens of thousands of gallons of water from the geyser continued landing on the homes for more than an hour before Department of Water and Power crews turned the hydrant off.
The three homes were damaged, one of them seriously. One family had to be evacuated and was set up with a hotel by the American Red Cross.
"It went through the chimney," said Juan Soto, who lives in one of the damaged homes. "Everything's wet inside, the carpet, the basement.
A man who lives in one of the homes said the suspect tried to run and allegedly had a knife, but the suspect fell and the resident was able to kick the knife into a gutter.
The suspect, whose name was not released, was taken to Alhambra Hospital Medical Center where officers waited for him to be released so they could book him.
City News Service contributed to this report.