Drop in homes for sale in biggest centres

The number of homes for sale in New Zealand's three largest cities has fallen to its lowest level in four years, according to figures released today by property website Realestate.co.nz.

Its latest monthly report shows that 8,542 new listings came onto the market in January _ three per cent up on the same month last year, but not at a level that keeps pace with buyer demand.

Realestate.co.nz chief executive Alistair Helm said January was always a slower month for new listings, but strong sales in the main centres had pushed demand for homes "far ahead of supply'' _ leading to the record low levels of inventory.

"The last three months has seen just over 30,000 new listings come on the market, which is equal to the same time period last year, yet sales are up 22 per cent,'' said Mr Helm.

"With the three major cities leading the trend, the market has tightened even further in most regions across the country.''

Mr Helm said the average asking price for homes had remained steady, down one per cent to at $417,740 _ in seasonally adjusted terms _ which he said showed sellers "were not stretching price expectations of buyers as yet.''

Figures released by the Real Estate Institute last month showed home sales climbed 20 per cent in the best December result since 2007, although sales were still at relatively subdued levels.

The number of houses sold in December rose to 5316 from 4397 a year earlier, though the number of houses sold was down 12 per cent from November. The median sale price achieved fell 3.4 per cent to $355,000 from a month earlier, and was up 0.9 per cent in December 2010.

The Auckland market was strongest with its best sales in December since 2006 and the house price index for Auckland rising back to all-time highs.

The REINZ Housing Price Index showed nationwide prices falling 0.1 per cent in December from November.

The nationwide index has risen 3.1 per cent since December 2010, but remains 2.4 per cent below its November 2007 peak.