"There's too much (housing) inventory..."

Not exactly. If housing prices were lowered and credit wasn't so hard to get, it would reduce the inventory. I think the credit crunch, which is one of the main causes of the decline was an overreaction by the lenders.

Not only are homes sitting vacant but also commercial properties- which you don't hear much about. As far as housing starts go, if builders are going to adjust to the new reality, they are going to have to wake up and build smaller, more affordable homes.

I work in the construction industry and the company I work for is hanging on by its finger nails. We've gone from 33 employees to 10. 4 of those work in the office. Most of our equipment sits idle, but half of it is not paid for. Many other companies and support industries are in the same boat. A lot have gone under.

The bosses haven't given themselves a paycheck for over a year. I get paid for 20 hrs a week by the company and the state is paying for the other 20 hrs at a reduced rate. This program ends in November. (I'm actually at work for 40 just incase they need me. I'm require to work the 20. The other time I spend on restoring a motorcycle.) I used to get at least 10 hrs of overtime a week but haven't seen that in almost 2 years.

If things keep going the way they have been, you're going to see some type of collapse of the construction industry. Companies are running on what little credit is available. This situation may cause the "double dip" that's being talked about.