It's not just "developed" country problem any more. It is also happening in developing countries, like India and Vietnam for example. In India, real estate prices have sky rocketed over the past 30+ years. Part of this is because of the rise of property development firms. Government encouragement too has played a role, I think, because construction (and the construction industry) does create a lot of jobs. Real estate is also a vehicle to hide black money, and that's another factor here in India.

(I wanted to strangle Trump when he once commented that real estate in India and other parts of Asia, are still "undervalued"!)