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It sure looks like the slow fizz of the housing bubble bursting is turning into a full blown explosion rather quickly. Countrywide, the nation's largest mortgage underwriter is now reporting that a whopping 4.56% of their prime mortgages are at least thirty days late, and their sub-prime mortgages are a whopping 23.71% behind.

During a conference call with Countywide earlier this week the following statement was issued: "Company is seeing home price depreciation at levels not seen since the Great Depression."

I believe it is only going to get worse throughout 2008 with the unbelievable amount of ARM resets due in that time period.

Update: More bad news from WAPO:

The Commerce Department reported that sales of new single-family homes dropped by 6.6 percent last month to a seasonally adjusted annual rate of 834,000 units. The decline was more than triple what had been expected and was the largest percentage drop since sales fell by 12.7 percent in January. Sales are now 22.3 percent below the level of a year ago.

The median price of a new home sold last month dropped to $237,900, down by 2.2 percent from a year ago. It was the biggest year-over-year price drop since a 6.5 percent fall in April. The median price is the point where half the homes sold for more and half for less.

The big drop in new home sales followed a report Wednesday showing that existing home sales dropped by 3.8 percent in June to a five-year low. The weakness reflects spreading troubles in the mortgage market as more borrowers are defaulting on their loans, dumping those homes back on an already glutted market. In addition, banks and other lenders are tightening their standards, making it harder for prospective buyers to qualify for loans.

Ouch.