Total residential house sales rose sharply in February, compared with a 10 year low-point in January, but seasonally adjusted prices fell and it is taking longer to sell homes as tax-shy investors stay out of the market.
Real Estate Institute of New Zealand (REINZ) figures released this morning show that although seasonally adjusted sales were up 7.1% month on month at 5,029 in February, year on year sales were down 3.8% and remain historically low, while the seasonally adjusted number of days to sell a home rose from 36 in January to 39 last month.
"The steady climb in days to sell from October's lows suggests the balance between supply and demand is returning to normal, following a period of under-supply through spring," said ASB economist Jane Turner.
The REINZ monthly national housing price index fell 1.1%, seasonally adjusted, in February.
With increased listings and fears over tax changes on investment properties, "the lift in supply should reduce pressure in the market and house prices are likely to ease over 2010 following surprisingly strong gains in 2009," REINZ president Peter McDonald said.
Much of the usual investor interest at the lower priced end of the market was absent at present.
"Agents report an air of caution amongst buyers, most of whom are genuine homeseekers as opposed to investors.
"Most interest at present is in the $400,000 to $600,000 bracket and no change in interest rates is keeping the genuine home buyers in the market."
The largest gains in median house prices were in Taranaki, up 9.6% to $285,900, and Auckland, up 7.59% to $453,500. Median prices fell in Otago, the only region to record a fall, by 0.44% to $223,000.
The ongoing decline in section prices also continued, with the REINZ monthly residential section price index falling 11.3% in the month of February, and are 3.4% lower than the same month last year.