Your explanation of fluctuations in supply and demand are not very revelatory. Everything being in flux at all times is kind of an elementary fact of life.
It's clearly not elementary if people here believe that you can just keep building until prices collapse, and people will still keep building.
The question is whether the market achieves equilibrium at a point where 1) developers can get financing to build profitably, and 2) units can be sold at a broadly attainable price to the local market.
The answer appears to be no because the cost of inputs is so high. No one here is talking about directly reducing the cost of inputs. They believe that instead developers will just continue to build units that they sell at a loss, or at least investors will continue to invest in construction that returns less than the S&P 500 or 10 Year Treasuries (they won't).