Spirits have the ability to come in contact with humans. They make use of human bodies as host by possessing them.
Hebrews 13:2 KJV
Be not forgetful to entertain strangers: for thereby some have entertained angels unawares.
In the case of spirits, which are considered to be holy, they may appear in human form. There was a passage in the book of Genesis where Abraham saw two men passing by in front of their how and the bible recorded that Abraham perceived this men to be Angels. Sometimes when we have visions in dreams whereby we see a man of God ministering to us it is not actually the man of God that is doing this but an Angel in the form of the man of God.
It's not everyone we see on the street that are humans. The truth is that some of them are actually spirits only in human form. We also learn in the Bible about the set of fallen angels who had relations with women on this earth and gave birth to beings of great stature. Angels cannot function in their divine nature unless they first of all acquire a human body before they can achieve this.
To avoid evil spirits being occupants in our body we need to surrender it to the Holy Spirit. Our actions and ways of life are influenced by either a right spirit or a wrong spirit. It cannot be vacant.
Evil spirits can exist physically
Evil spirits can exist physically