This is not exactly correct. For example consider a single office building and say it’s worth $2 billion. But now demand has fallen and the most anyway will pay is $1 billion. The other $1 billion is not “lost”, but it’s not freed up either. It just means that the buyer no longer transfers it to the seller. So the buyer has an extra $1 billion to spend on other things and the seller has $1 billion less. The net effect on the economy should be approximately neutral (of course sometimes if asset prices fall too much then companies can go out of business which can hurt the economy etc)