Median pricing has gained 14% during October to hit a record $412,000.
While domestic activity is expected to be weighed down until full details are released on the Labour-led Government's new housing policies, with an expected tightening to come on foreign buyers, some analysts are expecting brief, increased interest from that buying sector.
Compared with October last year, sales across Otago fell 26% overall, but in Queenstown Lakes District, Central Otago and Clutha, sales numbers all fell 38%-40%.
Conversely, prices in Queenstown Lakes District were up 11.8% and Central Otago gained 17.7%. Clutha was up 42.4% to $235,000.
There were 435 sales a year ago across Otago, compared with 323 last month, which was also slightly down on September's 342 sales, Real Estate Institute of New Zealand data showed.
Nationally, prices rose in 14 of the country's 16 regions for October, up 3.9% to $530,000, while sales volumes were down 15.8%, from 6759 to 5689 houses. Only two of the 16 areas had increased sales.
REINZ chief executive Bindi Norwell said given the Reserve Bank's loan-to-value ratio (LVR) restrictions had slowed the market, she welcomed the bank's recent indications to review its use of the LVR.
REINZ had repeatedly called for the LVRs to be removed for first-time buyers.
ASB economist Kim Mundy said sales were ''subdued'' in October while the population awaited formation of the next government.
''We expect sales activity and price growth to remain subdued into 2018, given the uncertainty around the impact of new housing policies,'' Ms Mundy said.
Dunedin's price rose by $40,000 to $380,000 for October, while sales numbers dipped almost 15%, from 211 to 180.
REINZ regional commentator Liz Nidd, in Dunedin, said new Dunedin listings were coming to market in greater numbers, noting that in October there were 111 listings left after 180 houses sold.
Multiple offers on properties were now the norm, not the exception, she said.
Mrs Nidd did not believe Dunedin's market would slow between now and the third week of December, as there were many ''unsatisfied'' buyers.
''More buyers are trying to be cash-ready in order to 'win' the multi-offer battle,'' Mrs Nidd said.
In the Queenstown Lakes District market, median prices on a year ago grew by $100,000 to $950,000; and by $30,000 compared with September, while Wanaka climbed to $850,000.
Queenstown-based REINZ regional director Gail Hudson said investors made up a ''significant part'' of the local market, and new bank lending regulations were ''challenging'' for them.
''Investors are still keen to take up opportunities, as they are aware they have less competition at the moment.''
Westpac chief economist Dominick Stephens said recent data showed new listings for October ''rose sharply'', suggesting the market was recovering from the pre-election lull, but the process was incomplete.
''Beneath the election-related volatility, the housing market remains slow,'' Mr Stephens said.
He noted house price inflation in regional areas was slower than a year ago, except
in Southland.
''We won't be surprised to see a short 'relief rally' in the housing market in the next few months, depending on the form of the government and any subsequent changes to the tax treatment of property,'' he said.
However, Mr Stephens said interest rates would be the ''dominant driver'' and predicted any bounce would be ''short-lived''.
