Viccy Thongmany and her boyfriend have been trying to buy a home in Denver for months, but they keep getting outbid. While that's not great news for potential home buyers looking for bargains after the housing bubble burst, it might be an indication that the housing market is bottoming out, notes Fox31 . Although it's not clear whether the housing market is actually on the mend, sales in July were good across the country. In Western states, 105,000 new homes were sold, the highest number since July of last year, reports the Denver Business Journal . Still, home prices are still declining, down one percent between May and August compared with the same period a year ago. But the big houses are driving the trend, writes The Denver Post . The average sales price for a single-family home smaller than 910 square feet was up by 14 from May through August compared with the same period a year ago, according to an analysis by Your Castle Real Estate. "Smaller houses really got beaten up hard by the foreclosure boom, and now they're rebounding," says Lon Welsh, managing broker of Your Castle. "It's pretty clear we're past the bottom on that. We haven't seen the overall prices go up yet because sales have disappeared on the high end."