House prices hold up

Neither the traditional winter slowdown nor the impact of rising interest rates is particularly evident in the housing market, the latest Real Estate Institute figures suggest.

The volume of house sales did slow slightly from 9,224 in April to 9061 in May but the May figures are a massive 40% higher than the number sold in May last year.

The national median house price also fell slightly from $189,000 in April to $188,000 in May but the May price is 10.6% higher than the May last year price of $170,000.

The Reserve Bank has raised its Official Cash Rate three times this year from 4.75% to 5.5% and the major home lending banks have raised their floating mortgage rates from 6.7% to 7.75%.

Real Estate Institute president Rex Hadley says the institute is very pleased with the level of activity in the market.

"On a region by region basis, both sales and values have improved throughout New Zealand, with all 11 regions showing increases in activity and median sale price on the same period last year," Hadley says.

May’s transactions were worth $2.1 billion, down from $2.18 billion in April but almost double the $1.31 billion in sales in May last year.

The institute’s figures show the median price rose in five of the regions compared with April while activity rose in four of the regions.

In the key Auckland market, which is likely to be among the Reserve Bank’s major inflation concerns, the number of homes sold in May eased to 3,268 from 3,379 in April but was well up on the 2,110 homes sold in May last year.

And Auckland’s median house price continued to rise from $265,000 in April to $266,000 in May which is 13.2% higher than the $235,000 recorded in May last year.