Coming out of the recession, a lot of conservative middle-aged and older individuals with "dry powder" started buying homes as rental properties. These people had established credit, relatively high salaries, and the kind of financial stability to go in on several homes at once ($120k is enough to put 20% down on 3 $200k homes). More recently, institutional investors have gotten in on this as well; I've helped set up REITs that exist in order to identify, purchase, and rent-out single-family homes in residential neighborhoods.

Long story short, (1) there are now significantly more buyers in the market, (2) those buyers have substantial resources and are not particularly price-sensitive, and (3) those buyers have depleted the stock of starter homes (the easiest homes to buy in multiples and the easiest to rent). All of those factors add up to higher average housing prices and a housing stock that is much more sensitive to disruptions (such as COVID-induced construction slowdowns).