"The pre-qualification process isn't difficult, and as a result, buyers will know exactly what they can afford, "

Unless something has seriously changed, prequalification tells you how much you can borrow, not how much you can afford to borrow. You need to sit down and do a budget for yourself to decide whether you can afford it. A lot of people get in trouble by believing the bank is doing their budgeting for them.

We got into this real estate mess, in part, because people believed that if a bank would make them a loan, they must be able to afford it. In fact, banks and lenders don't rely on your ability to pay to sell your loan on the secondary market. They rely on the underlying value of the home you are buying.

While  they look at your credit worthiness, its only credit issues that would raise red flags on your loan application with the secondary lenders that are going to be considered. They aren't going to pay much  attention to how secure your income is, whether you will need a new car next year, whether you have college tuition for kids, etc. In short, they don't care whether you can "afford" that pre-qualified loan or not.