Otago, Southland house prices up

Both house sales and auction numbers declined in March, the latter falling from 13.2 % to 918 properties, compared with 1243 at the same time last year. PHOTO: GETTY IMAGES

Otago and Southland median house prices continue to hit records for March, to a backdrop of plunging numbers of houses sold across the country.

Southland was top percentage price gainer in the country, up 25% to $300,000, followed by Otago, up 21.6% to $492,000, and Hawke's Bay, up 10.8% to $493,000.

However, the rising prices in Dunedin are pinching on first-home buyers.

Nationally, house sales plunged 12.9% against March last year, down from 7964 to 6938, which included volume declines in both Otago and Southland of about 5.5% each.

Real Estate Institute of New Zealand chief executive Bindi Norwell said the decline below historical expectations - of well over 7000 sales - down to 6938 meant the lowest total number sold for the month of March since 2011.

She said despite some "extremely competitive" bank mortgage rates and heightened chance of a cut to the interest-driving official cash rate (OCR), it appeared proposed legislative changes, especially a capital gains tax, and difficulty accessing finance, were now "really starting to impact the housing market in terms of sales volumes".

"Hopefully, as we gain more certainty over the coming months, particularly in relation to capital gains tax, we'll start to see volumes pick up," Ms Norwell said.

REINZ regional commentator in Dunedin Liz Nidd said the city's's market was "very active" in March, when measured by days on the market, declining from 34 days in February to 27.

"First-home buyers are finding the ongoing price rises are starting to test affordability thresholds," she said.

The Queenstown Lakes district was one of the few places to notch gains in sales numbers for March, rising from 82 a year ago to 99, while its median price rose 14% to $975,000.

REINZ regional director in Queenstown Gail Hudson said listings were down 18.7% for the region, which created more competition among buyers.

She said there was an increase in first-home buyers, and investor activity was continuing to increase.

"Cash buyers were also more visible, and we're seeing buyers are taking advantage of better buying in the regions, which will help the market track firmly," Mrs Hudson said.

Ms Norwell said looking at the regions, 15 out of 16 across the country saw an annual fall in sales volumes. The West Coast was the only gainer, selling just one more house than a year ago to take its total to 48.

"With listings down in both February and March, it's little wonder that sales volumes are down so significantly," Ms Norwell said.

At a glance

Housing data for March: median regional sale prices

National
$560,000 (March 2018)
$585,000 (March 2019)
4.5% (% change)

Auckland
$880,000 (March 2018)
$856,000 (March 2019)
-2.7%

Otago
$404,500 (March 2018)
$492,000 (March 2019)
21.6%

Central Otago
$460,000 (March 2018)
$500,000 (March 2019)
8.7%

Clutha
$215,000 (March 2018)
$230,000 (March 2019)
7%

Dunedin
$376,000 (March 2018)
$439,000 (March 2019)
16.8%

Queenstown Lakes
$855,000 (March 2018)
$975,000 (March 2019)
14%

Waitaki
$292,000 (March 2018)
$301,000 (March 2019)
3.1%

Southland
$240,000 (March 2018)
$300,000 (March 2019)
25%