With record low mortgage rates, the residential property market has continued improving, with more properties sold and for higher prices in May than the previous year.
Quotable Value statistics show the average sale price of New Zealand homes improved 3.9 per cent in the year to May to an average of $411,788. Auckland once again led the improvers, gaining 5.7 per cent to $545,577.
In Waikato and Bay of Plenty, sales were up, with 100 more houses sold last month than a year earlier. Prices dipped, however, by $4000 to a median of $311,000.
Real Estate Institute chief executive Helen O'Sullivan said Auckland houses were selling within 33 days on average, three days faster than a year ago.
That was on a par with the typical marketing time for properties in the Canterbury and Westland area, where demand has been heightened due to tightened supply following the two big earthquakes.
"First-home buyers and investors are active in the market at lower price levels, but the real driver of these results is the shortage of housing," O'Sullivan said.
While properties have been selling fast and well above ratings valuations in city fringe suburban areas of Auckland such as Ponsonby and Grey Lynn for some time, other areas of Auckland are now experiencing similar demand from buyers.
Some examples include North Shore, where sale prices have risen 4.9 per cent to $612,426 in the year to May, and Franklin, where properties lifted 5 per cent to $378,727.
QV valuer Glenda Whitehead confirmed low listing levels and pent-up demand were pushing up sale prices in central Auckland and that confidence was spreading to the wider market.
"While vendors may be seasonally orientated, wanting only to list in the summer to autumn months when their properties look their best, buyers who missed out on that period are still on the hunt. Subject to availability ... we should continue to see good activity over the winter months," Whitehead said.
The Wellington market had a more modest improvement, with a continued weakness in sale prices, which rose just 0.8 per cent to $507,090 in the three months to May.
However, sales volumes improved, with 735 houses sold unconditionally last month compared to 573 in May 2011. There remains a significant oversupply of apartments for sale in the capital.
Wellington QV valuer Pieter Geill said buyer confidence in the region had been dented by the possibility of further public service cuts.
"First-home buyers are still active and investors are coming back into the market, both attracted by the low interest rates."
Christchurch property sale prices climbed 5.4 per cent in the year to May.
- © Fairfax NZ News