Calculated Risk, who knows these data as well as anyone, says housing is entering a danger zone:
Sales of existing homes experienced a minor decline in May with home prices rising near normal rates, according to the National Association of Realtors®....
Total housing inventory levels rose 5.5 percent at the end of May to 3.60 million existing homes available for sale, which represents a 6.5-month supply at the current sales pace. ...
Click on graphs for larger image
Existing Home Sales are a trailing indicator. The sales are reported at close of escrow, so May sales reflects agreements reached in March and April.
Usually 6 to 8 months of inventory starts causing pricing problem - and over 8 months a significant problem. Current inventory levels are now in the danger zone.
Update: David Altig at macroblog has more.