However, median sale prices in Queenstown rose 15% in July compared with June.
The latest statistics released by the Real Estate Institute of New Zealand (REINZ) reveal prices in the Central Otago Lakes district fell from a median $565,000 in July 2008 to $411,000 in July 2009 - down 27.25%.
REINZ Central Otago Lakes president Henry van der Velden said the reason for the Central Otago Lakes drop was that international buyers had sold their investment properties in the Queenstown Lakes district in the recession.
"All it takes is a few top-end value properties to drop in price to cause that."
July 2009 recorded a median sale price of $530,000, 15% up when compared with $460,000 in June 2009 for Queenstown but 10% down on $586,667 in July 2008.
A total of 35 residential dwelling sales were recorded for July this year, 14% down on June at 41 and 19% down on July 2008 at 43. Residential section sales maintained a steady position, with seven sales for July compared with eight for June and six for July last year.
Nine sales were recorded for Arrowtown and seven sales recorded above $1 million, the highest value sale remaining below $2 million at $1,675,000.
Sales values remained relatively constant at $31,544,200 for July 2009, 8% up on $28,837,150 for June 2009 and 4% up on $30,397,167 for July 2008.
REINZ Lakes District spokesman Adrian Snow said there was a high degree of volatility in the Queenstown median sale price because of the small number of sales and the wide range of sale prices.
"I would consider our median to be tracking at about $500,000 over the 2009 year to date.
"I don't think there's any cause for concern at all. It probably means we haven't seen the normal lift in the number of sales through the ski season. Bearing in mind it's July, the first month of the ski season, August and September may show that increase."
Mr Snow said managed apartments were still slow to sell and reducing in value because of an oversupply in the market. There were seven sales in July 2009, compared with eight in June 2009 and six in July 2008.
Apartment median sales prices continued a downward trend, now at $450,000 for July 2009, down 5% compared against $470,000 for June 2009 and down 25% compared with $599,500 in July 2008.
He said there were "reasonable to good" numbers of potential purchasers, but vendors were not bringing their properties to market while they perceived the market value to be low.
"It's a stable market coming off a low base."
