REINZ says national median house price dropped 5.3% in January to $426,000; Auckland median down 2.7%; national sales volumes up 2.6% on January 2014

The housing market slipped into more of a usual summer pattern in January, with sales volumes falling sharply from the previous month and median prices slipping.

According to the Real Estate Institute there were 4841 dwelling sales nationally in January. While this is up 2.6% on the number sold for the same month a year ago, it represents a thumping 31.5% decline on the 7064 sales recorded in December. The December figures had been the highest for that month since 2006.

REINZ said the national median price was $426,000 for January, which was down 5.3% on the $450,000 recorded in December. But more significantly, the latest figure was a 6% increase on the median recorded as of January 2014.

The regional breakdown and commentary can be viewed here.

Westpac senior economist Michael Gordon said the housing market "took a breather" in January, after a few months of "very strong catch-up growth" following the September election.

He said that house sales volumes had fallen 13.5% in seasonally-adjusted terms.

"While the fall in sales was larger than we expected, at this stage we're not inclined to see this as anything more than a larger than usual holiday-related lull. A sustained pullback in sales wouldn't fit with the more timely data on mortgage approvals, which continued their strong growth in January after a small December dip."

In the much talked about Auckland market there were 1764 houses sold, a slight rise on the 1737 sold in January 2014, but well down on the 2734 sold in December. Auckland's median price, at $660,000 is up some 16% on the same time a year ago, though the figure has dropped slightly from $678,000 in December - which was a record.

The latest figures will be closely scrutinised by the Reserve Bank, which has been indicating its strong concern about the recent reheating of the Auckland market. It would appear the central bank would not be able to draw too many conclusions about the latest figures and will likely want to see the returns for February - when more normal levels of activity will have kicked in after the summer break - before contemplating any more action to attempt to dampen the market.

But it is unlikely either that the latest figures will have done much to calm the RBNZ's concern.

The REINZ Stratified Housing Price Index, which adjusts for some of the variations in the mix that can affect the median price fell 1% compared with December to sit at 4,037.3. Auckland fell 1.2%, Christchurch 1.1% and Wellington 0.6%.

For the 12 months to January the Auckland Index rose 15.1%, the Christchurch Index 4.5% and the Wellington Index 3.0%, while the national index increased 7.5% compared with January last year.

REINZ chief executive Helen O’Sullivan said the figures for January reflected "the typical summer slowdown at this time of the year, with volumes dropping back and prices easing across the country".

"December was a strong month, so the slowdown in January was a little more pronounced than usual."

She said the continuing strong performance of Auckland prices was "vexing commentators and policy makers alike".

"However, the root cause of the problem remains a shortage of property available for sale. Listings across Auckland remain very low by historical standards and this, coupled with continued high demand, is seeing prices inevitably move upwards.

"Increases in supply from new construction will help to ease this position, but for the present the lack of listings is the main impetus driving Auckland dwelling prices. The data shows that Auckland’s median price increased by 16% over the past 12 months, compared to just 1.8% for the rest of the country."

The comments on listing numbers were earlier borne out when Auckland's largest real estate company Barfoot & Thompson recently reported that its available listings were well down on the numbers available at the same time a year ago.