Residential property sales in the Western Bay rose 45 per cent last month compared with last August.
Latest New Zealand Real Estate Institute figures show there were a total of 246 sales in the Western Bay last month, compared with 169 for the same time last year.
Mount Maunganui and Papamoa had a burst. Eighty houses changed hands on the coastal strip, up from 63 in July and well ahead of the 47 in August last year.
Across the harbour, the volume reached 110 compared with 97 in July and 78 in August last year.
There was a similar trend in the Western Bay district, which includes Katikati, Omokoroa, Te Puna and Te Puke, with sales increasing slightly to 56 last month from 51 in July and 44 in August last year.
Buyers are now eyeing the higher-priced homes, and the median selling prices have moved up - a rise of $16,000 to $387,500 at the Mount and Papamoa; for the rest of Tauranga city an increase of $22,500 to $356,500; and in the Western Bay district up $4250 to $354,250.
The latest QV Valuations figures show property values in Tauranga are now only 0.5 per cent lower than the same time last year, and the average sales price based on the three months to August was $427,414, down from $432,461 in July.
Ross Stanway, of Eves Realty and Bayleys, said August's sales represented a continuing steady month by month growth compared with last year.
"A key challenge for the region is whether the growth will be sustained because of low listings on the market - buyers have got fewer options," he told the Bay of Plenty Times.
Mr Stanway said some buyers will hold off until they have more options, and this should send signals to vendors thinking of listing their properties.
"Up to now, some have been sitting, waiting and wondering, and this is the best time to put their house on the market," he said.
Mr Stanway said prices had stabilised and were slowly starting to creep up.
Max Martin, franchise owner of Harcourts Advantage Realty, said his firm's listings were strong and the market was looking reasonably positive.
"A lot of people are feeling more confident about our economy, the banks have eased their lending criteria, and vendors have become more realistic.
"They now know the prices four to five years ago are not there, and sales have picked up," he said. "The market is about 75 per cent towards what would be regarded as normal (for the size of Western Bay). When we reach 250 sales a month, then things would be ticking along at a nice sustainable level."
Greg Purcell, franchise owner of Ray White Realty Focus in Mount Maunganui/Papamoa, said the lift on the coastal strip was welcomed. "You'd think a wave of business would sweep through the whole city this large, but that's often not the way at all.
"The new infrastructure in Papamoa - supermarkets, schools and the start of the eastern motorway - has provided a psychological boost to the area. We are now starting to get renewed interest in sections, and buyers are starting to make decisions," he said.
John O'Donnell, principal of LJ Hooker Mt Maunganui and Papamoa, said the last month or so had been a bit weird.
"August was good but the last two weeks have been quiet. I'm wondering whether the Rugby World Cup is having an effect, and for this time of the year the volume of new listings is not up there."
Shayne Donovan-Grammer, of QV Valuations in Tauranga, expects to see a gradual increase in activity through to the end of the year.
REINZ chief executive Helen O'Sullivan said the improvement in sales volumes over the past few months was a positive sign, however, prices remained essentially steady. "One interesting aspect of the market is how well informed buyers appear to be and how focused they are on buying at what they see as their level," she said.
Nationally, sales in August were 21 per cent ahead of the volume for the same month last year.
The national median house price rose by $10,000 to $355,000 last month.