House sales volumes reached 7,330 nationally in March, the Real Estate Institute of New Zealand (REINZ) says, the most in a month since November 2007, with the national median price rising to a record high of NZ$370,000.
The national median price was up NZ$15,000, or 4%, from NZ$355,000 in February and was up NZ$5,000, or 1%, from NZ$365,000 in March 2011. The previous high was NZ$367,500 in November last year.
“The new record median price is only NZ$2,500 higher than the previous high set in November 2011 and is only NZ$5,000 higher than the median price in March 2011," said REINZ chief executive Helen O’Sullivan. "Prices are certainly not rising sharply, but the trend is certainly starting to move upwards."
The 7,330 sales is the highest since 7,837 in November 2007. The record monthly high is 11,378 in March 2004 and low is 3,252 as recently as January 2011. The March 2012 sales volumes are 1,162, or 19%, higher than the 6,168 sales in February this year, and 1,482, or 25%, higher than the 5,848 sales in March 2011.
New record median price for Auckland
Auckland also recorded a new record median sales price of NZ$495,200 in March, which is up NZ$27,000, or 6%, from February, and up NZ$25,200, or 5% versus March last year. O'Sullivan said the Auckland market reflected increasing demand for housing in the city and a lack of available stock, noting this was highlighted in the Productivity Commission's report out last week.
"Auckland Central and the North Shore area are both stand outs in terms of the upwards impact these combined factors are having on prices," O'Sullivan said.
In the other major centres, the Wellington price of NZ$393,750 is the second month in a row with a year-on-year decline of 5%, and at NZ$320,000 the Canterbury median price is a year-on-year rise of 10% for the fifth month in a row.
Stratified index still below national peak of November 2007, but Auckland & Christchurch at new highs
Meanwhile, REINZ said its Housing Price Index, calculated using stratification that gives an averaging of sales prices for common groups of houses and was developed in partnership with the Reserve Bank, is still 1.1% below the November 2007 peak at a national level. However, the Auckland index is 1.3% above the previous peak reached in July 2007, and the Christchurch index is 0.9% above its previous peak scaled in October 2007.
Other factors in the March figures include a record low portion of houses sold for less than NZ$400,000, with 4,085 of the 7,330 sales in this price range. And at 1,467 of total sales, it was a record high portion of sales above NZ$600,000.
The national median days to sell was 35 in March, down 11 from February and six lower than in March 2011. REINZ says during the last five years the national median days to sell has averaged 41.
ASB economist Jane Turner said housing demand was likely to remain supported over the coming year from earthquake-related insurance payouts.
"Low supplies of housing in Auckland and Canterbury have resulted in very tight markets there, and as a result house prices are increasing in these areas," said Turner. "We expect some of this pressure will be alleviated once rebuilding activity commences in Canterbury."
"The Reserve Bank is likely to be wary of the recent pick up in house price inflation and, if the increase in house prices does not abate once rebuilding starts, the potential for spill over into wider inflation pressures. However, for now the Reserve Bank can remain relaxed on the inflation front, as we expect inflation pressures to remain very subdued over 2012. We continue to expect the Reserve Bank will keep the Official Cash Rate unchanged until December 2012.
See the REINZ residential market statistics here and see REINZ's regional data here.
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