In my area we are being told to hold on to your assets. The deepest housing decline in 16 years is about to get worse.

As many as 1.5 million Americans may lose their homes, 100,000 people in housing-related industries could be fired, and an estimated 100 additional subprime mortgage companies that lend money to people with bad or limited credit may go under, according to real estate agents, economists, analysts and a Federal Reserve governor.

Financial stocks also could extend their declines over mortgage default worries.

The spring buying season, when more than half of all U.S. home sales are made, has been so disappointing that the National Association of Home Builders in Washington now expects purchases to fall for the sixth consecutive quarter after it predicted a gain just last month.

A five-year housing boom that ended in 2006 expanded homeownership to a record number of U.S. households. Now the industry faces mounting defaults, failing subprime mortgage companies and an increasing number of unsold homes.

If this slump follows the same pattern as the last one, in 1991, it will persist for at least another year and may fuel a recession. New-home sales declined 45 percent from July 1989 to January 1991, and about 1 percent of all U.S. jobs, or 1.1 million, were lost in that recession, said Robert Kleinhenz, deputy chief economist of the California Association of Realtors.

This time, new-home sales have declined 28 percent since September 2005, hitting a low in January, the last month for which data are available.

And though the national jobless rate is near a five-year low this month, mortgage-related jobs fell by almost 2,000 in January alone. At least two dozen of the more than 8,000 mortgage lenders have been forced to close or sell operations since the start of 2006.

Five large subprime lenders together have fired more than 5,600 workers in the past year.

New Century Financial Corp., the second-largest subprime lender, said Monday it had run out of cash to pay back creditors who are demanding their money. New Century has cut 300 jobs, and its 7,000 remaining employees are waiting to see if the company will survive.

Doug Duncan, chief economist of the Washington-based Mortgage Bankers Association, predicted in January that more than 100 home lenders could fail this year.

Subprime mortgages are given to people who wouldn't qualify for standard home loans and typically have rates at least 2 or 3 percentage points above safer loans. The portion of subprime loans that financed new mortgages rose to 20 percent last year from 5 percent in 2001, the Mortgage Bankers Association said.

As home prices steadily gained from 2001 to 2006, homeowners who fell behind on mortgage payments could sell their homes and pay off their loans or get better refinancing terms based on the higher value of their property. Now that home values are declining, many borrowers won't be able to refinance because they would have to come up with the difference between their new mortgage and what their home is now worth.

Defaults may dump more than 500,000 homes on a housing market already saturated with leftover inventory built during boom times, New York-based bond research firm CreditSights Inc. said in a March 1 report.

About 1.5 million U.S. homeowners out of a total of 80 million will lose their homes through foreclosure, University of California, Berkeley, economist Ken Rosen said last week.

The Center for Responsible Lending in Durham said in a December study that as many as 2.2 million borrowers are at risk of losing their homes, at a potential cost of $164 billion, from subprime mortgages originated from 1998 through 2006.

The number of foreclosures rose 42 percent to 1.2 million last year from 2005, according to RealtyTrac, while delinquencies in the last three months of 2006 rose to the highest level in four years, the Federal Reserve said.

Meanwhile, housing and related industries, which account for about 23 percent of the U.S. economy -- including makers of a variety of products, including copper pipes and kitchen cabinets -- fired about 100,000 workers last year. The total will be higher this year, according to Amal Bendimerad of the Joint Center for Housing Studies at Harvard University.

New-home sales plunged 17 percent last year from 2005, the biggest decline since 1990, according to the Chicago-based National Association of Home Builders. Existing home sales fell 8.4 percent in 2006 from a record in 2005, according to the National Association of Realtors.

A Standard and Poor's index of 16 homebuilders tumbled 4.1 percent Monday, its biggest decline since August, on concerns over increasing inventory and subprime defaults. The index has fallen 12 percent since Jan. 1.