that basically ends the purpose of a contract
I disagree. The owner has something to lose in civil court and damages could be severe for contract breeches. If the cops don't evict tenants who aren't paying their rent, the exact same argument could be made about ending the purpose of a contract. Maybe that's part of your point though.
The bigger problem here is DoS-ing the legal system.
I agree and part of what bothers me about this issue is that the solution is pretty clear and very ugly. People will start violently reclaiming their homes from squatters and the likelihood that invading someone's home will get you killed will act as the deterrent.
this territory is moderated