I call “walking away” a real life example of “turnabout is fair play”.
‘Course, it’s easy for me to say that. I realized in the early 2000’s that we were in a manufactured bubble, so I refrained from buying. I continued to rent - and watched those rents go down as rental homes and apartments were abandoned by people realizing the “american dream” of owning a home worth 12 years wages. ;)
Home prices need to go down further to re-establish equilibrium. That is going to happen whether anyone wants it to or not. Prices that are 4 to 5 times annual income are not sustainable.
It's a real estate transaction between a person and another party. That person has no obligation to their neighbors with regards to the value of their homes, and in reality, that foreclosure isn't what is causing the price destruction. Those forces are already acting on their own. The foreclosure simply forces a recognition of the price destruction that has already occurred because the asset was overvalued to begin with.
You sound knowledgeable. Do you think that someone today who has 50% equity in a home, one which has not lost much of its value, and a low 4.65% interest rate on a mortgage, but who can (just barely) afford to pay it off, should do so?
I don’t see your point. Do you feel people who made money on housing should have given some of the profits to the bank? Or is your moral stance one sided? When there’s a profit, it’s kept. When there’s a loss, it’s dumped on others? Sounds liberal to me.