No, you would save up to buy a car.
Same for a house, you would save up to buy it. The average house price would be lower because demand would be lower because only people who could afford it would be able to make an offer. Same supply, lower demand means lower price. You won't have to compete with over-leveraged fools who are on their 20th credit card as is the case today.
Saving is fine, as long as you know what your needs will be ahead of time and can wait.
But the social purpose of loans is to help people who have an urgent need, or an unexpected one.
Living beyond your means isn't inherently part of borrowing money.
If you can't get a loan to buy a house, having to save for 30 years is in some sense, making you a lot poorer. You only have so long to live, and for 30 years, you don't get to live in the house.
And if you can't get a loan when something unexpected happens, then bad things could happen, that are really unnecessary. People don't have to prepare independently for all possible disasters because we live in a society.
If you think borrowing money is bad, what about borrowing things? Should rental cars be eliminated? Is it only that borrowing things should be free? Is borrowing a cup of sugar from your neighbor ok?
Edit: I should say, urgent, unexpected, or short term.
