More houses were sold in Otago last December than in November, and at a higher median price, although property values fell during the year in keeping with the national trend.
None of the 12 areas in the country showed increased sales for December when compared with the previous December, however, with sales overall dropping by 23.2%.
The Otago December sales results, released by the Real Estate Institute of New Zealand, were slightly better than might have been expected, Dunedin district institute president Stephen Johnston said.
"It's still not back to where it traditionally has been, but I am not sure we are going to get there."
It was still too early to tell what the feeling in the market was, as it had not geared up completely after the holiday break.
It was usually the end of January before there was an indication of what the year would be like through until winter, he said.
People may have been holding off buying because of a lack of certainty or confusion about what they were doing as a result of the international financial situation.
The December results show that 221 houses were sold in Otago compared with 203 in November and 260 in December the previous year.
The December 2008 sales were on a par with those in December 1999 (223) but well below the heights of 390 in December 2003.
Central Otago Lakes area was the only area in the country to show an increase in the median price of houses sold in December 2008 compared with the previous December.
The price of $427,500 was up $8500 on the November median price but well below the $490,000 recorded in the area in December 2005.
In Otago the median price was $230,000 compared with $223,000 in November.
Auckland was the only area to record a higher median price at $440,000.
The national median house price for December was $328,500, 4.78% lower than that in December 2007.
Institute national president Mike Elford said the downturn during the past few months was evidence of a correction of what in some areas were wrongly inflated values.
"Anyone who has been in real estate for any length of time will have come to expect the peaks and troughs of property market cycles."
The market was also contending with the world's worst economic figures in 40 years, he said.
"Lower interest rates and tax cuts will increase people's confidence and with Government commitment to further liquidity, I believe we can expect to see a market comeback not too far off."
Quotable Value statistics for December, also released yesterday, showed house values continuing to decline in the main centres, with the overall decline for the year 7.4%.
QV manager for Otago and Southland David Paterson said fact the average sale price for Dunedin residential properties in December was still holding at $254,263 (compared with $275,540 a year earlier) indicated there was less lower-priced housing being sold.
Sales of higher-priced housing were keeping the average up.
People were not buying lower-priced houses, around the $180,000 to $220,000 mark, for first homes or investment properties.
"It is an indication of the slowing of the market."
A graph of what was happening in Dunedin showed that the decline had levelled off a little, but it was still a decline.
Property values grew by 120% between 2002 and mid-2007 compared with the last period of sustained growth between late 1992 and the end of 1997, when the increase was 54%.
QV points out the sustained drop in property values has been the first since 1998.
The REINZ figures show that in common with Otago and five other areas, Central Otago Lakes also had better sales figures in December than in November, with 84 houses sold compared with 69, still well down on the 124 sold the previous December.
The national median house price for December had dropped $9000 from November to $328,500, considerably lower than the $345,000 of December 2007.
