Ticki-tacky doesn't exactly describe the million dollar houses I know.
Anyway, your price scale is wrong; most of those houses were built for under $50,000 (although with loss of dollar value, and increase in lot (land) value) that would equal perhaps $1 million today.

Example, my house cost $30,000 and would go on the market now for $900,000.

My question hasn't been answered- what other options did these GI Bill and other returning servicemen have? Plus burgeoning population as mentioned. California had an additional problem- influx of people continued.