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This morning the National Association of Realtors released its existing home sales data. Among the highlights are:

Limited supplies of housing inventory held back existing-home sales in May, but sales maintained a strong lead over year-ago levels and home prices are on a sustained uptrend in all regions, according to the National Association of Realtors®.

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, declined 1.5 percent to a seasonally adjusted annual rate of 4.55 million in May from 4.62 million in April, but are 9.6 percent above the 4.15 million-unit pace in May 2011.

Total housing inventory at the end of May slipped 0.4 percent to 2.49 million existing homes available for sale, which represents a 6.6-month supply at the current sales pace; there was a 6.5-month supply in April. Listed inventory is 20.4 percent below a year ago when there was a 9.1-month supply.

Distressed homes - foreclosures and short sales sold at deep discounts - accounted for 25 percent of May sales (15 percent were foreclosures and 10 percent were short sales), down from 28 percent in April and 31 percent in May 2011. Foreclosures sold for an average discount of 19 percent below market value in May, while short sales were discounted 14 percent.

Regionally, existing-home sales in the Northeast fell 4.8 percent to an annual level of 590,000 in May but are 7.3 percent higher than May 2011. . Existing-home sales in the Midwest rose 1.0 percent in May to a pace of 1.04 million and are 19.5 percent above a year ago. In the South, existing-home sales slipped 0.6 percent to an annual level of 1.78 million in May but are 9.2 percent higher May 2011. Existing-home sales in the West declined 3.4 percent to an annual pace of 1.14 million in May but are 3.6 percent above a year ago.

There are headwinds facing home sales, with the primary factor being availability of credit. Sure, rates are low which should spur home buying, but banks are not as willing to lend as they were as securitization has become more difficult and changing capital requirements.

I have written numerous articles about the real-estate market and many have disputed what I see as the trend in real-estate (increasing from the bottom) and in homebuilders (which I view as near-term fully valued, but attractive longer term), but this data, while weaker in the headline, continues to support the trend in the sector. There are still headwinds - clearing REO, short-sales, demographics favoring renting (although financially it is almost breakeven), credit availability and the continued perception of weakness - and now is not the time to be a cheerleader of the sector, but the time to see the trend and find the best way to take advantage of it given an investors risk/return profile and time frame.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Disclaimer: This article is for informational purposes only, it is not a recommendation to buy or sell any security and is strictly the opinion of Rubicon Associates LLC. Every investor is strongly encouraged to do their own research prior to investing.

Source: Existing Home Sales Weak Today, But Trend Holds