A Tauranga real estate agency owner says the housing market is going "gangbusters" - with the selling price of one property increasing by $122,000 in just two years.

First National Mount Maunganui, Tauranga and Omokoroa owner Anton Jones said the property in Welcome Bay, which sold for $285,000 two years ago, sold for $406,000 a couple of weeks ago.

The owners of another property in Welcome Bay had also had an unexpected windfall after a sale fell through four months ago, he said.

Mr Jones said it sold for $70,000 to $80,000 more than the initial price a few months later.


"Another property in Welcome Bay we've heard of which we had sold previously had gone up by $90,000 on the previous selling price," he said.

The sales come after Bay of Plenty properties reached a record high average asking price last month, according to Realestate.co.nz figures.

The region's average asking price was $501,961, up 3 per cent on the previous high of $487,052 set in November.

It was only the fourth region in the country to break the $500,000 ceiling, according to Realestate.co.nz.

New listings for the region were down 7.6 per cent on a year ago.

Mr Jones said the market had definitely hit new levels going into 2016.

"Last Tuesday we listed a property in Ohauiti which we had previously listed and had seven offers within days, including a number of Auckland property investors."

Mr Jones said the housing market was so busy and competitive that some people were putting in offers "sight unseen".

"There is, of course, a risk in doing that and first-home buyers who are having to compete with property investors are a little bit more conservative and want to see building and LIM reports."

Anything under $500,000 was hotly contested, he said.

Mr Jones said he had been operating in the Tauranga property market for eight years and the past year had been the best year he had seen in terms of listings and sales activities.

"It's going gang-busters," he said.

Eves and Bayleys chief executive Ross Stanway said the new high had not priced first-home buyers out of the market.

There were still homes available below the $400,000 mark, some of which were in new subdivisions.

Interest rates were low and banks were competing to attract mortgage borrowers, Mr Stanway said.

However, people were being realistic about what they could afford.

In some cases they had to compromise on what they thought they could buy.

"The fact remains that pretty much at every price level there are properties available, and it becomes a matter of to what extent first-home buyers are prepared to compromise on what their original aspirations might have been."

Mr Stanway said some buyers might move to outlying areas like Te Puke and Katikati rather than live in Tauranga and Mount Maunganui.

"There's some of that occurring without doubt."

He said a significant number of high-end homes had sold recently. There had been plenty of activity at that top end of the market over the past six months.

"And that, of course, would be helping to drive up the average price."

Brendon Skipper, chief executive of Realestate.co.nz, said the national average asking price in January was $542,514, up on December but short of the all- time high of $568,215 set in August last year.

The number of new listings was 8144, down 14.6 per cent compared with the same month a year ago, said Mr Skipper.

National inventory in January hit a new low of 14.7 weeks.

Inventory is a measure of the national supply of homes for sale, expressed as the number of weeks it would take for all listed properties to sell at average rates, should no new properties get listed.
Bay of Plenty inventory was at 11 weeks.

"The record highs in average asking price in a number of regions need to be seen in the context of fewer listings and tightening inventory," he said.

The housing market:

* Eight regions experienced record highs in average asking price in January: Bay of Plenty, Waikato, Coromandel, Taranaki, Wellington, Central Otago, Canterbury and Southland.