My street has 17 homes on it. That means that if my neighbors and I are typical of that great statistical average known as "the rest of the country," nearly three of the households owe more for their homes than they're worth.

I've sussed out five reasons why the housing sector is in such a pickle, and by examining them we can see more clearly what needs to be done to make it so that the sun again shines on our nation's housing sector. And maybe we'll get a feel for how long that will take.

1. The teetering and the fallen. It's easy to become consumed with numbers, but the key is that a rapidly growing swath of Americans either couldn't unload their homes without writing a big check at closing or have already received vamoose notices from their lenders. According to numbers tossed out recently by The Wall Street Journal, of the 75.5 million U.S. households that own their own homes, one in six owes more than the hacienda is worth.

That's a sobering 16%, for those who'd rather deal in percentages. It compares to 4% just two years ago and 6% last year. And among those who've owned their homes for fewer than five years, the underwater share is 29%. Beyond that, since the numbers work out to about 12 million homes that are affected, if you assume that the median value of the homes is about $200,000, the total liability for all the mortgages is about $2.4 trillion, should all the owners' keys be mailed back to the lenders. So maybe the $700 billion bailout number could be just a starter figure.

And then, as we learned Tuesday from RealtyTrac Inc., which keeps tabs on foreclosures, 766,000 homeowners received at least one foreclosure-related notice in the September-ended quarter. That's up fully 71% from the year-ago quarter. The firm is forecasting that more than a million bank-owned homes will have been piled up on the market by year's end. Therein, of course, lies the problem: Until the foreclosure metrics slow meaningfully, home prices won't -- can't -- stop sliding and that 16% figure will only expand.

2. Nailed by the builders. This year, the likes of Lennar (NYSE:LEN), Pulte (NYSE:PHM), Ryland (NYSE:RYL), and Centex, along with the smaller regional builders, will sell more than 450,000 homes. That's a paltry number when you compare it to the 1.2 million new units sold three years ago. Nevertheless, it would be wonderful if the builders could all take a year off -- which, of course, they can't -- and allow that massive inventory of listed new and pre-owned homes to be slimmed down.

3. The waiting-in-the-wings inventory. I've maintained for a while that there's actually a huge inventory of homes that folks would love to list and sell, but that are off the market because their owners realize the folly of even putting up "for sale" signs. Should the market begin to strengthen nationwide, those "waiting-in-the-wings" homes will begin to be listed, thereby slowing the recovery.

4. Mortgage Madness. It's still possible for those with superb credit to be granted mortgages. But the process is far more difficult -- if saner -- than was the case in days of yore, like three years ago.

But with Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE) having become wards of the federal government … Washington Mutual being bailed out by JPMorgan (NYSE:JPM) … and the now-infamous Countrywide going to Bank of America (NYSE:BAC), only time will tell how long it'll take to create a sensible and streamlined mortgage lending process in the U.S.

5. Consumers shed their confidence. On Tuesday, The Conference Board told us that its consumer confidence index fell to 38 this month, the lowest level ever. The new number compares to a revised 61.4 for September and was well short of the 52 that economists had expected. Those who lack confidence in the economy or in their own job situations simply don't buy big-ticket items, like houses, cars, or even washing machines.

So there you have it: five situations that have to be cured, at least to some degree, before housing will even begin to stabilize. All this will, of course, occur over time. But at this point, "over time" likely means years, rather than months. On that basis, the homebuilders aren't generally good targets for Foolish investment funds.

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Fool contributor David Lee Smith does sport a mortgage, but doesn't own shares in any of the companies mentioned. He does welcome your questions or comments. Bank of America and JPMorgan are Motley Fool Income Investor picks. Try any of our Foolish newsletters today, free for 30 days The Fool has a disclosure policy.