I think the second part is the only real distinction: mobility. Nobody who owns real estate is going to relocate across the country for a 6 month contract.

As far level of compensation everybody in the US, including H1B workers, work according to US compensation ranges but are limited by visa sponsorship. Software developers tend to average about 2.2x or more than the average US income even in expensive urban areas. In cheap rural areas the difference is staggering. If these developers lack sufficient talent the problem isn't compensation. The problems are improper preparation and improper candidate selection. Increased compensation without controlling for preparation and selection will only provide perverse incentives to magnify the existing problem.