If trillions of CDOs were to hit the market all at once because of a concentration of defaults, Bob's house isn't likely to be worth $100 anymore. Depending on how much the CDO Jenga tower inflated the value, it might not even be readily sellable at $50.
Why? Because it will be competing for buyers with Charlie's, Dave's, Eve's, Frank's, George's, Henrietta's, Irma's, Julie's, etc houses that are all also for sale after their defaults and those remaining standing with cash or liquid credit will be able to be choosy and drive a hard bargain especially if they're not going to personally occupy the property (as then they are largely indifferent among the competing housing stock).
Why? Because it will be competing for buyers with Charlie's, Dave's, Eve's, Frank's, George's, Henrietta's, Irma's, Julie's, etc houses that are all also for sale after their defaults and those remaining standing with cash or liquid credit will be able to be choosy and drive a hard bargain especially if they're not going to personally occupy the property (as then they are largely indifferent among the competing housing stock).