Out of curiosity I looked for the house that couple is selling. Believe it's this:
https://www.zillow.com/homedetails/30206-Telluride-Ln-Evergr...
Notice the price history. 83k in '97, which is about 170k now. Being sold for a 10x profit. Sigh.
https://www.in2013dollars.com/us/stocks/s-p-500/1997?amount=...
1. $83k is not the total cost of ownership; it's just the loan balance. Just looking at a home mortgage calculator, the out-of-pocket costs of buying an $83k home at the historical interest rate of 1997, which was about 7.6%, is about $363k[0].
2. Homelessness is a crime in most states, so housing becomes a natural short position that everyone has to cover, just like taxes.
Outside of estate sales, it is very rare for a home seller to not also be a home buyer. The monetary value of the home is, for them, a way to accelerate and account for what would otherwise be a barter transaction. So if you're expecting to have to buy a home for a million dollars, and you've already spent $350k on the loan, then $1.2 million means you'd be about $150k in the negative, not counting closing costs and moving costs, compared to doing nothing. The $1.3m asking price is close to break even for people who aren't planning on dying anytime soon.
[0] I used this calculator: https://www.calculator.net/mortgage-calculator.html?chousepr...