Which is to say, what you're saying makes financial sense, but people aren't robots, and we have negative feelings associated with debts/financial liabilities. For example a lot of people worry about losing/changing jobs exactly because of these kind of financial burdens.
If being "mortgage free" gave people more confidence to take more risk (e.g. change jobs, take a work-break, start a business) it could ultimately still be more beneficial than the alternatives, even if the maths doesn't show that.
My point is % return is not everything. I would gladly give up a 1.5% return in exchange for the ability to up and move when I need to, or respond to emergencies such as legal/health/family/political and resource instability/etc.
Also, there is no reason to assume home values in general protect against inflation better than savings accounts or other "safe" investments".
But as I said above raw cash (or near-cash) is even more conservative than mortgage repayments.
> Also, there is no reason to assume home values in general protect against inflation better than savings accounts or other "safe" investments".
History gives us a good reason to believe that. Cash depreciates. Homes on average appreciate.
I agree that paying early improves your ability to move, though. You're less likely to be "underwater" (lose money) selling the house with more equity.