The Rotorua property market is slowly coming right as it heads into spring - recording a leap in year-on-year sales.
"We've had a gradual increase over the year, May was a bit of a hicker but we're heading in the right direction," Rotorua Real Estate Institute of New Zealand (REINZ) spokesman Ian McDowell said. "Hopefully, it will just keep on slowly building through to the new year."
Vendors had been more realistic with prices on the "depressed" market, Mr McDowell said.
"New properties coming on the market that are correctly priced are selling quite quickly, whereas properties that had been on the market for quite some time that are overpriced are still just sitting there."
The latest REINZ Residential Market Report shows the median Rotorua sales price dropped $23,750 from July to August, to $251,250.
Mr McDowell said that indicated more lower-priced properties were selling, rather than property values dropping.
Increased spring activity had seen "days to sell" fall to 50 last month. "We're heading in the right direction but it's going to be a slow and gradual climb out of the big hole we were in."
The national median house price jumped $9000 from July to August, reaching $370,000 - up 4.2 per cent on the same time last year.
"While both Auckland and Christchurch recorded new record median prices during the month it is the strong sales volume growth in Auckland that is most notable," REINZ chief executive Helen O'Sullivan said.
Auckland's median house price has reached a record - up 1.1 per cent to $505,500.
"Across the rest of the country, while we are continuing to see rising sales volumes, prices continue to reflect the general caution around the economic outlook," Ms O'Sullivan said. There were 6035 properties sold nationally in August, an increase of 843 on the same time last year, and up 2.2 per cent from July.
Also breaking records is the number of houses sold by auction. In total, 1110 properties went under the hammer in August, representing 18.4 per cent of all sales.
The previous record was in March, when 16.2 per cent of properties were sold by auction.
The auctions are driven by the fluidity of the market, Ms O'Sullivan said.
"The best way to check the market value of a property is to take it to auction."
Despite the increased level of activity, the housing market was still subdued overall, with prices yet to catch-up with increases in the consumer price index over the past five years, Ms O'Sullivan said.
ASB chief economist Nick Tuffley said the housing market was seeing gradual improvement and mortgage rates were likely to remain low if the situation in Europe did not spark any spectacular crises with global implications.
PROPERTIES SOLD IN AUGUST
- 84 houses sold, compared with 90 for July and 66 for August 2011.
- On average, it took 50 days for a property to sell, compared with 68 for July and 44 for August 2011.
- The median house sale price was $251,250, compared with $275,000 for July and $201,000 for August 2011.
- 252 $1m-plus houses sold.
- 912 $600,000 to $999,999 houses sold.
- 1507 $400,000 to $599,999 houses sold.
- 3364 houses sold under $400,000.