The province's overall sales were up 25% on a month earlier, while the tourism centre's prices rose 12% for the month - or 25% compared with a year ago.
Nationally, sales numbers were down 12% on a year ago, and sales volumes have now fallen for 11 consecutive months, while the national median price gained $20,000 to $420,000 compared with a year ago.
Dunedin fared less well than either wider Otago or Central Otago Lakes, as both price and volume declined on a year ago, from $266,500 to $265,000 and 166 sales to 152.
REINZ Otago spokeswoman Liz Nidd noted that school holidays during September affected buyer interest around the city, and of the 152 September sales, 78 were in the less-than-$300,000 tier, which dragged down the median price.
''The shortage of listings is an ongoing issue at the moment,'' she said.
However, while house prices nationally were ascending, the rate was easing and almost 90% of the September gain was credited to prices in Auckland (68%) and Canterbury-Westland (20%).
REINZ chief executive Helen O'Sullivan said despite stronger activity in the latter part of September post-election, sales volumes were again well down on the same time last year, which meant sales volumes compared with last year had fallen for 11 months in a row.
''The pace of price increases has eased significantly, with the annual rate of price increase now only 5%, compared to more than 10% in April,'' she said.
Across the country in September, Otago led 10 regions by recording the largest percentage increase in sales of 25.4%, up from 169 in August to 212 for the month, albeit down 7% from the 229 sales in September last year.
While prices in the wider Central Otago lakes region rose from $419,000 a year ago to $479,000, in Queenstown they gained 25%, from $500,000 to $624,500.
Ms O'Sullivan said investors around Queenstown were taking a more active role in the market.
Buyers with ''longer-term investment horizons'' were now ''noticeably active''.
''The numbers of first-home buyers has diminished somewhat,'' she said.
Compared with a month earlier, Queenstown's prices were up 14% and the wider Central Otago Lakes up 15%.
Compared with September 2013, the national median house price increased by $20,000, or 5.0%, to $420,000.
Nine regions recorded median price increases.
The Auckland regions saw median September prices rise from $570,000 last year to $615,000.
In Canterbury-Westland they rose from $375,000 to $413,000 and Christchurch was up from $400,000 to $425,000.
''Unusually, listing levels are low even in Auckland where prices are at historically high levels, with the increased prices not tempting vendors into the market.
''We will be closely watching listing levels in October, as a continued lack of choice is frustrating would-be buyers,'' she said.
