It's certainly possible, though I don't think it will unfold that way -- the dynamics this go around are quite different, making it hard to make a prediction with any degree of confidence.

In 2008, there were many many more homeowners who were hopelessly overcommitted, for whom foreclosure was inevitable. In some cities, the majority of the housing stock was held using mortgages that couldn't be repaid.

This time around, homeowners are in much better shape -- nearly all mortgages outstanding are fully-amortized and fixed-rate, for example.

Most of the supply glut is in the hands of developers, and most are still under construction. Developers are more likely than individual owners to be able to wait out a downturn -- they're more likely to be well-capitalized than a homeowner chasing the peak in 2007 was for sure.

And if developers fold, their unfinished units may not get finished, and might not come to market (for a long while, at least).

But, unlike 2008, the feds don't really want to prop up the market, so "amend, extend, and pretend" isn't likely to be around to slow the supply.

All in all, a tough prediction, but I tend to think that this downturn will be milder except in a few key overhot markets (especially TX)