Otago median sale prices and sales volumes appear to have finished their downward slide and found their new levels, Real Estate Institute of New Zealand national president Mike Elford says.
Figures for 2008 showed that with the exception of Queenstown - a market Mr Elford described as "explosive" - the median prices for houses sold in Dunedin and the rest of Otago did not fluctuate wildly.
In both Queenstown and the rest of Otago, sales volumes reduced by about 50% on previous years.
Mr Elford, a Dunedin real estate agent, predicted more sustainable prices and sales volumes throughout the region in 2009.
"We've had the shorter, sharper decline in recent months . . . and now we have come down to a sustainable level.
"With a much lower Reserve Bank official cash rate, pressure on banks to reduce mortgage interest rates and tax cuts leaving people with more money in their pockets, there is generally a more positive feeling about 2009," he said yesterday.
Lower prices meant houses were more affordable for first-home buyers, while other purchasers and vendors were not affected by lower prices provided they were buying and selling in the same market, he said.
Nationally, house sales slumped by 40% during the first half of last year and the market recorded its first median price decline since 2001.
Various surveys predict the median value of houses being sold will continue to fall throughout at least the first half of this year, with one economic consultancy firm expecting Otago-Southland median house prices to drop by 9.5%.
Mr Elford was more optimistic.
While Otago sales were low and slow during the traditionally busy October-November period, there were indications December sales figures would be better, he said.
Those figures are due to be released next week.
"Dunedin and Otago show great resilience to market forces. People are more conservative spenders here. I think sales will have picked up over the summer, but it will be February or March before we get those figures."
Queenstown real estate agent Adrian Snow said he agreed median prices and sales volumes appeared to have found their new level.
"Things have been relatively stable for a few months now."
Any trends in Queenstown median sale prices were difficult to interpret as the number of monthly sales was so low one or two sales at the top end of the market could skew the figures, he said.
Last year was significant because international purchasers withdrew from the market in droves, he said.
Until the end of 2007, foreign buyers made up about 50% of purchasers; now they made up only 20%.
Mr Snow said he did not expect international buyers to return to the market until the end of this year or sometime next year.
He expected 2009 would continue to be a "relatively difficult year" for people trying to sell managed apartments.
There was "very much an oversupply" of apartments and sales prices had dropped.
People who had bought apartments primarily as investments had also been hit by reducing rental returns and increasing mortgage interest rates.
Both Mr Elford and Mr Snow said 2009 would continue to be a difficult year for real estate companies, who were having to trim costs as sales income reduced, and for agents, who were having to work harder to earn their commissions.
There are about 435 licensed agents in Otago, including about 140 in Queenstown.
Mr Elford had not heard of many agents leaving the industry but said the picture would become clearer in April because all agents who intended to keep working had to be relicensed by the end of March.
