Home Buyers Starting to Bite?

Despite falling prices, liquidity may be returning to California's housing market. June's unsold inventory index for existing homes in California dropped to 7.7 months, a decline from 10.2 months last year. Sales across the state rose for the third consecutive month to gain 18% from last year as deep discounts on foreclosed properties enticed buyers into the market. In the Sacramento region, one of the hardest hit markets in the nation, sales rose 95% year on year.

Snapshot asks, is this increase in liquidity in the housing market a sign that the market will soon bottom?

Wall Street Journal - Home-Price Declines Accelerate
Sacramento Business Journal - Home sales up, inventory index down statewide
Contra Costa Times - Resets Begin Peaking on Subprime Loans