The number of new listings in Canterbury rose 17% in July from June but remains 23% down on a year ago.
According to a property survey by realestate.co.nz, prices in Canterbury were down 1% in July from June and were down 3% from the prior three months.
The survey also revealed a 7.4% rise in the asking price of properties in the Central Otago lakes region.
The survey's authors said the Queenstown property market was gathering pace again with the three-month sales volume up 26%.
On a seasonally adjusted basis, the asking price is up 10%.
"The regions that are seeing the greatest pressure in inventory are the major regions of Auckland, Otago, Nelson, Otago Lakes and the Waikato," the survey said.
"These five regions are all sitting with inventory well below long-term average and based on recent listing shortages will see levels fall further heading into spring."
A trend of falling inventory due to rising sales and shortages of new listings began a couple of months ago in Auckland and is spreading to other major metropolitan areas in provincial New Zealand.
"Auckland remains the epicentre of this trend and now sees a situation where available inventory of property for sale is the lowest seen since this recent property malaise began back in 2007."
Auckland has just over 5.5 months of available inventory.
The highest level of inventory was recorded in June 2008 at just over 13 months.
"While shortage of supply matched to low inventory and rising sales usually sees pressure on prices, the asking price for July showed what is a traditional fall - seasonally adjusted it was down 1.6% - indicating that sellers new to the market are not being wildly optimistic in their expectations; potentially keener to sell quickly than inflate expectations."
