It's related to Balmol's Cost Disease [1]. Everything that is not technology is increasing in price relative to what employing those people in a high-productivity-multiplier industry would, and of course physical real estate is the ultimate in non-substitutable, non-automatable goods.
This is the same reason that education, healthcare, and other human services are eating more and more of the GDP: anything that can't be automated becomes dramatically more expensive by comparison with things like industrial automation and information technology.
BCD applies to costs of production in which a given factor (typically labour) hasn't had its productivity increased, but because it competes for other employment, the price paid for it if any of the resulting good is to be provided must keep pace.
The interesting part is what BCD doesn't describe, which is the amount of the good provided. The canonical case is the string quartet: you need four performers, no matter how much technology you've got. But: the total demand for string quartets need not remain constant. Tastes could change favouring other forms of music, recordings or broadcasts can increase the productivity of the four essential players, etc.
(The evolution of popular music from self-provisioned to big band to amplified orchestra to amplified three- or four-piece rock groups, to synthesizer, to disco, rap, house/hip-hop, and now extensive one-person sampling acts, is one example of the type of shifts that can occur.)
The "factors of production" in housing are raw materials, housing, and land. Land itself is the original rent-seeking good, for various reasons that ... modern economics fails to explain very well. My argument is that land is a network of control points (owning land gives you control in the right to exclude others), and with varying access costs to other useful capabilities (manufacture, employment, trade, education, entertainment, ag, etc.). The characteristic of economic rents is that the prices they command rise to include part, or all, of the consumer surplus. This contrasts with commodities and labour in which prices generally fall to costs. That paired relation is David Ricardo's famous two observations: the Iron Law of Wages, and the Law of Rent.
(This is why I see both a rent tax and some mix of UBI / employer of last resort with a living wage guarantee as a probably necessary economic policy.)
So, thanks for the opportunity to play with some economic concepts, but Baumol's got nothing to do with this. Your men are Ricardo and George.
Cost disease primarily applies to markets where much of the product is labor. Construction has been slow to automate, but there has been considerable progress especially recently. Most of the excessive cost of properties comes from land rights and acquisition costs and not construction. Over long periods housing markets revert strongly to medians.
What the sibling posters said -- it's not related. Cost of production itself is actually going down because we get ever better tools to make the houses and they don't have a fixed "human content requirement" to the labor.
Costs are spiraling up because of restrictions on building -- both the density, and the transit that could handle it.
This is the same reason that education, healthcare, and other human services are eating more and more of the GDP: anything that can't be automated becomes dramatically more expensive by comparison with things like industrial automation and information technology.
[1] https://en.wikipedia.org/wiki/Baumol%27s_cost_disease