Banks require insurance to get a mortgage. Increased borrowing costs (effectively) will reduce what people can afford and lower the value of the land (and house

Banks require insurance to get a mortgage. Increased borrowing costs (effectively) will reduce what people can afford and lower the value of the land (and house). People do live in places where you can't get a mortgage. For example, I'm thinking of a rather sparse community on the big island in Hawaii that's on the side of a volcano. However, both the land and the structures people build are much cheaper. It seems like in the limit, it's basically like a campground, and if you need to move then you move.