Mortgage Insurance was designed to back up risky home loans where the borrower couldn't put up a 20% down payment. Now with home prices naturally declining in many markets, many Mortgage Insurance providers won't give mortgage insurance on Investment Properties, Second Homes, and Primary residences seeking 100% financing.
Here is a list of markets AIG defines as "declining" where Mortgae Insurance standards have increased. AIG Declining Market Report
If the Private Mortgage Insurance companies won't insure these areas, it looks like they are confident prices will continue to decline and foreclosures will continue to remain high in these areas.