11 Mar 2016

House sales surge outside Auckland

4:13 pm on 11 March 2016

National house sales hit their highest level in nine years in February, as activity surged outside of Auckland.

A house for sale sign outside a home (stock shot).

Photo: 123RF

The Real Estate Institute said sales rose 6 percent to 7291 last month compared with February a year earlier, while the median price increased 5 percent to $450,000.

Sales plummeted 18 percent in Auckland, though prices rose 11 percent to $750,000.

Excluding Auckland, sales rose 18 percent and prices jumped 9 percent to $383,000.

Median prices hit record levels in Waikato/Bay of Plenty, Hawke's Bay and Wellington and Nelson/Marlborough.

The Institute's chief executive Colleen Milne said the figures underlined the surge of activity in regional markets.

"The Canterbury/Westland and Auckland region, which were previously the drivers of the national real estate market, are now playing 'second fiddle' to markets such as Waikato/Bay of Plenty, Hawke's Bay and Central Otago Lakes.

"Other regions such as Wellington, Southland and Manawatu/Wanganui are also showing renewed vigour."

Westpac senior economist Michael Gordon said tougher property rules have had an effect in Auckland, and was stoking demand elsewhere.

"The emerging picture is one of a more subdued, but still positive, trend in the Auckland housing market since the regulations on property investment that came into force last October. Meanwhile, most markets south of Hamilton continue to gather momentum."

Reserve Bank decision to boost demand

Lower interest rates will fuel an already buoyant property market, Ms Milne said.

The Reserve bank decision to cut rates yesterday should boost robust demand.

"Any interest rate deduction does help fuel the ability for purchasers to be able to borrow more or invest more and I imagine that will have a long-term effect on continuing the market and continuing the strong sales that we're seeing."

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