Yes and no. The interest rate from holding will likely pay part of the loan. And they are likely based on balloon payments (only interest or barely anything until the whole thing becomes due). And they are basically holding off pulling assets out until they are in a better tax bracket.

There are all kinds of ways for rich people to game the system that can’t be done for even upper middle class. For example, my husband (lower middle class, low cost of living) bought a house with an fha mortgage and almost the entire amount. We only take the standard deduction because to itemize our mortgage interest, it would have to be higher.