At an abstract level, it's likely caused by low/stagnant supply, and increased demand which is inelastic (not affected much by changes in price). Imagine a rea

At an abstract level, it's likely caused by low/stagnant supply, and increased demand which is inelastic (not affected much by changes in price). Imagine a real estate market with only 100 1BR apartments to rent. If 85 are occupied, 15 available, and 5 people are trying to rent those 15, the price of rent should remain about the same as 10 will remain vacant. However, if 40 people are trying to rent those 15, the price of the 15 will be bid up due to a limit in supply. Then the remaining 25 people will continue to bid up rents for any new vacancies. A scenarios like this can cause rents to skyrocket, especially if supply remains nearly constant.