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California for-sale inventory at 2005 levels

Homes on the market in May represented just 3.5 months of supply

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Inventories of homes for sale in California continued to shrink in May, as the highest pace of sales since February 2009 reduced the supply of available homes to just 3.5 months -- down from 4.2 months in April and 5.7 months at the same time a year ago.Many housing analysts view a six-month supply of homes as a good balance of supply and demand -- anything less means there are not enough homes to meet demand. "Low housing inventory continues to be the critical issue in the California market," said California Association of Realtors Chief Economist Leslie Appleton-Young in a statement accompanying the release of the latest numbers. "Inventory levels have not been this low since December 2005, when the supply matched the current level."Sales of existing, single-family detached homes were up 3.4 percent from April, to a seasonally adjusted annual rate of 572,260 in May, CAR said. That's the fastest pace of sales since February 2009, when homes were selling at a sea...