Latest data suggests the property market has reached a trough, and the Reserve Bank appears to agree.
Reserve Bank Governor Alan Bollard today said he thought the housing cycle had bottomed out and was gradually strengthening.
"We don't put too much stress on month by month data in one particular region, but what we've been seeing in Auckland is broadly symptomatic of the sort of gradual recovery we're expecting to see across the country. Part of which is made more uncertain and more unclear, of course, by the Christchurch situation."
He made the comments shortly before the Real Estate Institute of New Zealand (REINZ) released its sales figures for April, which recorded 4987 unconditional sales last month, down from 5848 in March and 5207 in April 2010.
The national median house price eased by $5000 from March, to $360,000, but was up $4000 compared to a year earlier.
Auckland reached an all-time high median house price of $479,500, up 2 percent from both March and from a year earlier, while the region also led the country in the number of days to sell which eased from 35 to 34 days in April, reflecting a shortage of listings.
Nationally, the median days to sell in April was 43 days, up from 41 in March and 40 a year earlier. All regions other than Wellington, Southland and Nelson/Marlborough recorded a fall in days to sell.
The REINZ housing price index was up 1.1 percent in April compared to March, with the stratified median house price at just under $365,600.
Compared to April 2010, the index fell 0.4 percent, and it is now 4 percent below the peak of November 2007.
ASB economist Chris Tennent-Brown said ASB expected nationwide prices were troughing now, and should rise by about 3 percent in the year ahead.
Behind that lift would be a range of experiences, from stronger price appreciation in areas such as Auckland, and ongoing weakness in areas where population and income growth were less supportive.
ASB calculated nationwide sales were up a seasonally adjusted 0.4 percent in April from March, with the big driver of the lift coming from Canterbury. When the Canterbury figures were stripped out, turnover was down a seasonally adjusted 3.7 percent.
As well as the damage and disruption caused by the February earthquake in Christchurch itself, insurance difficulties had held up sales. There were only 193 sales in Christchurch in March, compared to 315 last month and 511 a year earlier.
Goldman Sachs economist Philip Borkin said the market appeared to be consolidating after recent improvements, although the level of activity remained low.
He did not expect large increases in house prices, largely due to affordability headwinds.
But the stabilisation in prices opened the door for households to potentially begin slowing the pace of deleveraging, resulting in modestly improved household consumption growth.
