Is that a bubble I hear popping?

Housing slowdown squeezes borrowers

Foreclosure cases hit 12-year high

The number of foreclosure notices filed against Massachusetts homeowners last year reached their highest level since the housing bust of the early 1990s, as homeowners fell behind on their mortgages and lenders began the process of taking back the properties.

It's happening, in part, because our national housing pyramid scheme, whereby we all agree that prices will go up forever and thus we can all buy whatever house we want, even if we can't afford it, knowing it will inevitably be worth more in the future, is starting to break down:

... Homeowners who stretched their finances to the limit to buy a home found it more difficult to make their payments on variable-rate mortgages as interest rates rose, but they were less able to refinance their loans at more attractive rates -- or sell and pay off their debts -- because the value of their homes fell or remained flat.

''When prices are skyrocketing, you have the option" of selling the house for a gain or refinancing, said Nicolas Retsinas, director of the Joint Center for Housing Studies at Harvard University.

''In an economy where price appreciation is more modest or doesn't exist, what option do you have left?" he said. ''Sadly, one of those options is foreclosure." ...

This isn't some trivial increase -- there were 32% more foreclosure filings in 2005 than in 2004. And it's mostly happening right along the coast, i.e., in and around Boston, where the boom, presumably, was at its boomiest.

Is this coming to your neck of the woods next?