The number of New Zealand house sales rose to a six-year high last month and prices touched a new record as Auckland continued to drive up the national average.
Some 8,128 houses were sold in March, up 23 percent from February and 11 per cent from the same month a year earlier, according to the Real Estate Institute. The national median price rose an annual 8.1 per cent to $400,000, the first time it's broken the $400,000 mark.
About 90 per cent of the increase in the median price has come from Auckland and Canterbury over the past year, meaning those markets, which account for just over half of all sales, are over-represented.
"There's a real danger that the Auckland housing market is mistaken for the New Zealand housing market, and that regulatory decisions will be made on the assumption that conditions in Auckland and Canterbury are replicated across the rest of the country," chief executive Helen O'Sullivan said in a statement.
"Across the rest of the country while activity is picking up, price gains are far more modest."
The figures come after Finance Minister Bill English today flagged housing as a risk to New Zealand's economy in a pre-Budget speech, saying it could drive up interest rates if the current level of property price inflation persists.
Quotable Value figures earlier this week showed property values continued to grow in March, albeit at a slower pace.
Auckland's median sale price rose 5 per cent to $565,000 from February while Canterbury/Westland's increased 1.1 per cent to $359,000.
ASB economist Jane Turner said "improved household confidence and low interest rates are factors underpinning a lift in housing demand," with Auckland underpinning growth.
Housing demand has steadily increased over the past year, and a lack of listings in Auckland and Christchurch means "the true level of demand may be higher than the level of sales turnover suggests," she said.
The REINZ stratified housing price index, which smooths out peaks and troughs, rose 2.4 per cent from February, and was up an annual 8.6 per cent. Auckland's stratified housing price index jumped 16 per cent on an annual basis.
The number of days to sell fell to 31 days in March from 39 in February.