> Why would a homeowner send 1-2 paychecks...

Can't the asset holder - the homeowner in this case - get rid of the asset which stopped performing? Why such a strange financial behavior? If the houses are financials - why not to deal with them as such?

That would be rational for the home owner, but for many losing money on the biggest investment they have is not really practical. Losing value on a percentage taxed asset is not really practical for govenrment.

Also - the mortgage lender may not allow a sale at a lower than loan value price. The result is foreclosure, and even more loss in value.

Allowing our cities to become unlivable, inhospitable, and overall crazy places to accommodate letting people have enormous gains on an asset they do barely any work to improve was not practical but we did it for many years and it's time to stop.

> letting people have enormous gains on an asset they do barely any work to improve was not practical but we did it for many years and it's time to stop

This makes little sense. In a democracy, it will be hard to get people to vote against their own best interest.

> Bringing prices down is usually a losing idea with existing asset holders

Good. They should lose because they abused government policies through NIMBYism to inflate their assets prices. Happy to see them lose

This would be nearly every family in America. I'm not happy seeing my kids, my 80 year old mother lose money they are counting on. This is really the problem - reducing home prices hurts homeowners. And homeowners are litteraly everyone.

It certainly hurts homeowners who would be upside down on their mortgage, which would mostly be people who just bought a house and people with a 2nd mortgage. My house costing twice what it did when I bought it does literally nothing for me because so does every other house! I can't actually get anything from the increased "value". Actually, it mostly hurts me because I pay more in insurance and property taxes.

It would not be nearly every family in America, that's the point. That's why people are mad. We work for 30-40 years and have no pathway to home ownership so your 80 year old mother can have a home appreciate 800% over her lifetime without lifting a finger.

Households stand to gain overall from increased supply. House prices per se are a wash; even a homeowner indirectly pays a whole lot of hidden "rent" on local real estate since it's going to enter into the price of anything that's bought locally.

> Builders are walking.

Why? Builders are supposed to be doing the paid work, why would they walk out of it?

If you buy a plot of land, go to a builder and ask them to build a house on it, sure, they'll do it. That's not what most builders do most of the time, though.

Most of the time, most builders buy a piece of land, build a house on it, and then find a buyer (or at least while they're in the process of building the house). If they're having trouble selling houses, then they're left with a bunch of houses on their hands, on which they're having to pay the interest. They don't want to be in that position.

> They don't want to be in that position.

Then where are the builders which do what they're asked to? Is the problem with the banks which don't do this operation? Then it looks like a financial opportunity.

You're effectively saying "this business model doesn't work". This doesn't mean there are no other business models which work in this case. Where they are?

> Then where are the builders which do what they're asked to?

These are independent companies. Who do you think is supposed to be asking them to do something? When a customer asks, they do it. What more do you want?

> This doesn't mean there are no other business models which work in this case. Where they are?

They made less money than this model over the last decade or two. So they are nonexistent, not in the sense that they are impossible, but in the sense that nobody uses them.

Could companies start using them? Sure. But probably, first some homebuilders who use the current model have to go bankrupt. (A side benefit is that some already-built homes would go on the market at bankruptcy sale prices.)

> But probably, first some homebuilders who use the current model have to go bankrupt.

I think it's not necessary. The different model homebuilders should pick up the orders, that's it.

They don't exist - today, at least not in any quantity. There are very few "different model" homebuilders waiting around to pick up the orders.

It's not like you think it should be, and the path from here to there is less smooth than you seem to think it is.

People built houses for millenia. In America the small scale builders were here pretty recently - even now, I suspect, you can find them all across the country. I would be surprised if people completely forgot how to build houses all by themselves.

Perhaps because they signed a contract and want to buy another house sometime.