A few things broke.

1 inflation definition and actually inflation are two different things. Real inflation is m2 money supply.

2 us debt and money devaluing makes assets raise in price.

3 is permitting costs. The first to build a house has gone up a ton.

4 supply. Permitting restrictions and requirements make building small houses not viable for most. Tiny homes today are pretty close to the price of a house 2 or 3 times the size for only 20-30% more money.

5 low interest rates for too long. Low interest rates cause prices of assets to rise incredibly fast.

Loan term requirements becoming relaxed. 30-45 yr loans are the norm now because consumers are willing to take on life long debt terms. In a limited supply situation you are competing with people willing to pay more with longer terms.

6 speculation. This is mostly from the low interest rate environments. People buy assets to beat the interest rates. Companies buying houses for profit from flipping or renting also contribute.

The only way we get adorable housing is 10% interest rates, abolishing the 30-45 yr loans, and remove permitting costs and restrictions.