House sales shot up 37% in February, compared to the previous month, although prices remain flat.
However, it was the best February result the market has recorded since 2008.
The Real Estate Institute of New Zealand's Market Report show its members sold 6168 houses during the month, 1666 more than in January.
The average sale price remained steady for the third consecutive month, at $355,000. It was, however, 1.5% higher than a year ago.
The average selling time fell by a day to 46 days.
Westpac senior economist Dominick Stephens says prices in Auckland and Canterbury have been leading the market, but prices in urban centres are picking up too.
He describes the trend as "not a wild change" in the market but a modest upturn, and expects prices to rise a further 4% this year.
REINZ chief executive Helen O'Sullivan says while the result shows buyers are getting back into the market, it is only a recovery to previous highs.
"February 2011 was one of the worst months we've seen in some time and figures are only two thirds of what we saw back in '07. So it's a return of quiet confidence or perhaps the slow departure of pessimism.
"We are seeing prices stay pretty steady and would expect that stability to continue in terms of prices."
Property values 'still creeping up'
Meanwhile, the Government-owned valuer QV says property values are continuing to creep up.
Figures from Quotable Value show nationwide property values have risen 1.1% in the past three months, and 3% in the past year.
Values are still 3% shy, however, of the market peak in late 2007.
QV says while market activity is higher than in previous years, buyers are still cautious.
Auckland remains the fastest-growing main centre, with prices rising 1.7% in the past three months.
