All the people posting "I won't be able to move forward". SURELY there's something you can store and move forward?!
I only hit the '7000 item' warning this event, and I've been playing almost since the original Android release. I have a 1300% multiplier (+SH) and have almost every premium item and character. My town is clean and fairly well (But not extravagantly) designed. And still, in my own town, I know there are many things that aren't really visible, or that are duplicate, etc, that I don't mind putting away if I have to.
I wonder if alot of the item cap complaints are from the 2000+++ % clubs and their hoards of I&S signs and news vans. If so... I can't really blame EA.
Just my perspective - YMMV!