A projection of the expected growth of negative home equity in the US:
That's a national average currently at 10%, expected to rise to over 15% by the second quarter of 2009! (Reaching 25% in the West?)
If these estimates are accurate, the US economy may start feeling a much more significant impact, with more foreclosures and unwillingness of people to sell their homes at a loss. Already, these effects are starting to have an impact on labor mobility in the US.
The Washington Post has more on the housing crisis, covering the boom, the bust, and the aftermath, plus more. Elsewhere, some lessons learned from the housing crisis.
Like I've said many times before, renting has a lot of perks that tend to get overlooked. Until the housing market gets settled down a bit, renting may not be a bad way to go.