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Otago house prices have mirrored the rising national price trend during February, as the Reserve Bank sets out to further dampen housing enthusiasm with its first interest-rate hike in almost three and a-half years tomorrow.
The Reserve Bank's loan-to-value (LVR) restrictions on bank lending may be making inroads into suppressing house sales at the lower end of the market to first home buyers, but prices in the upper buying brackets continue to swell.
The national median house price rose 8.6%, or $33,000, to $415,000 from February last year, while in Otago the price rose 3%, or $7500, from $243,000 to $250,500.
The separate Central Otago Lakes region median was down almost 3%, from $450,000 to $437,000.
While representing only 6.7% of sales, the number of homes in the more than $1 million bracket sold during February in the past two years more than doubled from 201 in February 2013 to 415 last month.
Mounting house-price pressure has been one of the Reserve Bank's main concerns, being linked so closely to inflationary pressures.
Despite the decline in the number of sales, total sales in February a year ago were worth $3.15 billion and those last month were $3.17 billion.
About $40.2 billion was spent on house sales in the year to February.
While median prices are up, the total number of February sales was down 7.6% from February last year to 6125 homes, with the largest group, sales under $400,000, down 17.7%.
Real Estate Institute of New Zealand (REINZ) chief executive Helen O'Sullivan said the under-$400,000 decline might be because of the Reserve Bank's imposition last October of its loan-to-value restrictions (LVR) on banks' lending criteria.
The total number of New Zealand sales was down 7.6% compared with February last year, but the number of sales in the $600,000 to $1 million price bracket was up 9.2%.
''This may indicate that while first home buyers are mostly sitting on the sidelines, the focus on the market has moved to higher price ranges, with a subsequent upward influence on the median price,'' Ms O'Sullivan said.
ASB economist Daniel Smith said while demand, especially at the lower end of the market, appeared to have fallen off a little since the introduction of LVR, the number of homes coming on to the market had also fallen.
''That looks to be keeping supply very tight and means upwards pressure on prices continues,'' he said.
Central Otago Lakes may have been down on median price but it recorded the largest percentage increase in sale numbers in the country, up 26.4%, from 129 homes a year ago to 163.
Northland was the only other region booking a sales increase, up 11.5% to 175 sales.