New Zealand's median house price rose 3.4 per cent in May to $210,000 to defy predictions of a slowing housing market.
Real Estate Institute of New Zealand president Graeme Woodley said today that despite suggestions the market might be in line for a breather, the national median increase was underwritten by
a particularly busy market.
The Auckland housing market showed signs of stabilising, with the median price slipping by $1000 to $289,000. However, that remained ahead of the $266,000 median price in May 2002.
"Although it would be easy to say Auckland has come off the top after leading the recent surge in house prices around the country, the fact that the May volume reached 4005 sales, a record for May since 1996, indicates that the market in Auckland is very buoyant still, although undoubtedly underpinned by strong apartment sales," Mr Woodley said.
Nationally, the median price increase was driven by markets in Wellington and several smaller regions.
The Wellington median rose to $255,000 from $235,000 the previous month, and was well above the May 2002 median of $204,000.
In Northland the median rose to $167,000 ($150,000), Hawke's Bay's median was $163,000 ($156,500), and Nelson/Marlborough's median rose to $217,000 ($198,000).
Regions to experience a decline were Waikato/Bay of Plenty/Gisborne, Manawatu/Wanganui, and Otago.
The volume of May house sales rose to 11,158 from 9047 sales in April, and 9016 in May 2002.
Market confidence was underwritten by the reduction in mortgage interest rates, and the recent reduction in the Official Cash Rate to 5.25 per cent.
"Over the next couple of months we might expect some seasonal easing in the market, but with likely further falls in interest rates and strong demand for housing arising from factors such as positive migration, the fundamentals of the market still look pretty sound," Mr Woodley said.
"Essentially we are looking at a market really only catching up on a very flat period in the late 1990s."
- NZPA
