From the WSJ.

California's inventory of unsold, previously owned homes shrank to a five-year low in December, in another sign that the state may be coming out of its worst housing slump in decades.

The supply of unsold single-family homes dropped to 3.8 months from 5.6 months a year ago and 16.6 months in January 2008, when inventories were at a peak, according to estimates released Friday by the California Association of Realtors. The inventory levels are now at their lowest level since 2005, resulting in frenzied sales with multiple offers in some cities.

Running of the Bulls believes that the housing bottom is in nationally, although some states and cities have further to go on the downside.  However, other areas are showing classical signs of a bottom.  This is one as states that lead us into this mess are the ones first coming out.