I'm failing to see why people can't have both. Save up 20% down for a decent house. Get the house, then borrow against it for car. It's not like you have to save up 10s of thousands for a house AND save up 10s of thousands for a nice car.
That being said, Once I was out of school and had stable income, I bought a nice car first, paid it off as fast as I could, then bought a condo, then upgraded to a house, then bought a second, newer nice car (as in I still have both cars).
I understand that it's going to different for everybody. Generally speaking though, if the goal is to have nice car(s) and nice house(s) by middle age, FOCUS ON THE HOUSE. If you're okay with driving a nice car and renting an apartment for your whole life, theres nothing wrong with that as long as you know you're pissing your money away just to be able to drive a nice car.