Here home prices have come down, but not far enough to offset the high mortgage rates. So, if the seller is still servicing a mortgage then they may be staring at a capital loss - exactly what I recall froze the market in the UK in 1980/90s.

Looks like their "losses" are largely theoretical, in that based on past projections. It also looks as if fees are too high - this is the USA, so not global - banks don't really like to repossess as that costs them money plus the loss of repayments. Not a sector that can squeeze out much sympathy from the public!