The $500,000 floor seems to be a benefit for people who have $500,000 houses to sell. Doesn't do much for Joe Sixpack while he's deciding whether to stick or walk away.
"'Applicants can spend the entire amount on one house or spend as little as $250,000 on a residence and invest the rest in other residential real estate, which can be rented out,' the paper added."
$250k's not terrible.
In theory if high-end prices go up, it should have a cascading effect with lower-end prices going up to fill the vacuum.