I've been looking into encrypting $HOME, and have been happy with eCryptFS (
https://launchpad.net/ecryptfs). However, for it to work, it needs both a kernel module as well as the userspace utils.
As far as I can tell, the only missing dependency in the kernel is "Enable access key retention support" (CONFIG_KEYS) (could be built as a module), and CONFIG_ECRYPT_FS itself can also be built as a module.
The userspace utils depend on keyutils (
http://people.redhat.com/~dhowells/keyutils/) and libgcrypt.
Many thanks!