While existing home sales are not a true barometer of new home sales, there was at least a bump up in existing home sales for May. This rise of 2.4% to 4.77 million annualized units compares to 4.66 million units annualized in April and compares to Dow Jones consensus estimates of 4.80 million. Before you celebrate too much that you can finally get rid of your I.O. loan, there is a reason here to suspect that the rise is there that isn’t necessarily the biggest news for sellers.

Existing home sales rose in May, as increasingly affordable home prices and a first-time tax credit attracted hesitant buyers.

Realtors say home resales fell 3% in March, but analysts point to signs of a stabilizing market.

It is correct that sales peaked in 2005, and have fallen steadily since then. And it is also correct that the rate of decline has slowed. However this doesn't suggest to me that "a bottom may be near" for existing home sales.

It's important to note that about 45% of these sales were foreclosure resales or short sales (banks selling foreclosed properties). Although these are real transactions, this means activity (ex-foreclosures) is under 3 million units SAAR.