> People who bought 10 years ago for 200k do not want to sell it for 250k, because they paid more interest, let's say "initial price + interest = 300k" today.

I think you are significantly overestimating the average American's willingness and ability to calculate and understand something as simple as their "cash on cash return".

> I think you are significantly overestimating the average American's willingness and ability to calculate and understand something as simple as their "cash on cash return".

I think you are also underestimating market forces, average American doesn't need to calculate, real estate agents will tell you the price, they are not going to sell your house for 100K, if it costs 1M

I think what most people who are living in their house look at when deciding if they well sell is if (selling price - remaining amount on mortgage) will give them enough that when they put the proceeds toward buying a house where they are moving too they will be in good shape financially.

> People who bought 10 years ago for 200k do not want to sell it for 250k, because they paid more interest, let's say "initial price + interest = 300k" today.

I doubt there are many people who think that way. If they want to sell, the market determines the price so stomping your feet and saying I want 300K just because, isn't going to work.

Second, that's an incorrect calculation anyway. They may have put 300K into it, but they also got 10 years worth of a place to live out of it already, which is a lot of value. So the breakeven price considering the rent they didn't have to pay for 10 years is not the full 300K.