I would agree that months of inventory is the truest indicator of the motion of the market, but I would point out that a pure inventory number is also useful; I think it is *perhaps* a better indicator of general public market psychology. If the inventory keeps rapidly rising, clearly people think it’s a great time to sell and throw their house on the pile. That it has stabilized / declined indicates to me that the general public no longer think they can easily sell their house for a great price.
