Key Points:

Auckland house prices dropped $416 a day last month after agents struggled in the face of the recession.

But property experts cautioned that the annual price drop _ about $5000 nationally _ was a better indication of the market than month-on-month fluctuations.

Real Estate Institute figures showed Auckland's median house sale price fell from $447,500 in May to $435,000 last month.

That drop _ $12,500 in 30 days _ was for sales within Auckland Regional Council boundaries, but the picture was much worse in one pocket of the city.

Auckland City ratepayers' values tumbled $32,400 in the month, from $504,500 to $472,100, equating to a fall of $1080 a day.

Prices rose elsewhere, but Wellingtonians lost around $700 a day on their properties as the median sale price fell from $389,500 to $366,500.

The figures are based on the month's sales, which the institute says are the single most reliable source of data, recorded on the date the transaction becomes unconditional.

Other surveys are estimates of values only, the institute says.

Economists are less interested in the highly volatile monthly price fluctuations than volume of deals recorded and length of days to sell _ two other indicators that have also suffered this year.

Last January, Barfoot & Thompson figures showed Auckland house prices were rising by $540 a day, leading to speculation the bubble had to burst soon.

The Real Estate Institute said yesterday that the national median price dropped from $345,000 to $340,000, a trend president Murray Cleland attributed to more lower-priced sales and the time of year.

Winter is always quiet for real-estate agents but only 4305 sales were made throughout the country last month, more than 3000 fewer than recorded in June last year, when 7474 sales were made.

The time it takes to sell is also continuing to rise. A few months ago, it took about 30 days to sell a property, but by May it was taking an average 49 days and last month it took 53 days.

ASB chief economist Nick Tuffley said prices were holding up fairly well, despite the glut of listings. Mortgage rates dropped during May and June, which might have given the market a little support in the short term.

"However, there is still a considerable adjustment process to play out in the housing market through a combination of prices weakening further and some vendors taking their houses off the market."


Real Estate Institute of New Zealand