1) Foreclosures, and this will get worse as more and more ARMs reset. Over half of those who got loan workouts to avoid default are now in default again.
2) All this money the Fed is printing to artificially prop up the economy will force interest rates up again.
3) Lost jobs, and more of it to come. Unemployed people can't get mortgages. And who is going to commit to mortgage payments when they don't know if they still have a job next year?
4) Many people are upside-down in home equity, and have no reason to keep paying the mortgage. So it just gets worse and worse.
5) People who might buy are going to sit on the sidelines to see how low prices will go.
6) Banks are still not lending.
7) Destroyed wealth: The stock market crash has wiped out a lot of people's nest eggs.
8) Mobile homes are the future for many people. They're affordable. A whole lot of baby boomers are being laid off and forced to retire, and will wind up in mobile homes. Not that mobile homes are not counted in the housing starts number, so that statistic is understated.
I could write a book on how to co-habit with your parents at 45 married with kids. You guys, I owe ya, Thanks! I'm going to be rich....If you guys are right. If you are wrong Im going to be rich with my shares. My book will be my option play of sorts.
#9) A HUGE oversupply of vacant homes. It's going to take years to work through the supply of homes. Foreclosures in many areas are selling for below replacement cost. As people lose jobs, they will be moving in with their parents and relatives, increasing the home supply even more.
Just wish that E-trade had shares of MTH to short at the moment...