3rd way out is to drop the rates just low enough to allow a huge number of owners to refinance and provide enough general market liquidity to get the new homebuilding going again. New homes (higher quality) prices might start to be lower than existing homes, and that would allow existing owners to swap out of current houses for a new one without taking a huge bath on monthly payment.

Everyone getting an allocation of the Sovereign Wealth fund (or collateralizable Social Security Trust allocation) with the ability to borrow against it to buy a house would also lubricate the highly manipulated housing market. It seems inevitable at this point that home prices will drop some once the manipulated supply side is fixed with supply-enhancing liquidity. The only big loser is the criminal counties stealing property taxes unlawfully when they get a slightly smaller cut.

CAVEAT: New houses must have ALL "Green requirements" and restrictions removed. This is why new houses are currently not in demand by those that can choose existing or new.