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NZ house sales rise 2.6% in January, median price dips from December

New Zealand residential property sales rose in January from the same month last year, while data confirmed house prices in Auckland continue to gallop ahead of the rest of the country.

The number of sales rose 2.6 percent in January from a year earlier to 4,841, although they dropped about 32 percent from December, reflecting the typical summer slowdown, the Real Estate Institute said. The median price was $426,000, up $24,000 from January last year but down by $24,000 from December.

In Auckland, the volume of sales rose to 1,764 last month from 1,737 in January last year. The median price of $660,000 was up from $569,000 a year earlier and down from $678,000 in December. In the past 12 months, the median price in Auckland has jumped 16 percent, while for the rest of the country the gain was just 1.8 percent.

The strength of the Auckland housing market is being watched by the Reserve Bank governor, Graeme Wheeler, who said this month that house price inflation "appears to be increasing again in Auckland due to rising household incomes, falling interest rates on fixed rate mortgages, strong migration inflows and continued market tightness." REINZ, though, said lack of supply was the biggest issue.

"The continuing strong performance of Auckland prices is vexing commentators and policy makers alike.However, the root cause of the problem remains a shortage of property available for sale," said REINZ chief executive Helen O'Sullivan. "Listings across Auckland remain very low by historical standards and this, coupled with continued high demand, is seeing prices inevitably move upwards. Increases in supply from new construction will help to ease this position, but for the present the lack of listings is the main impetus driving Auckland dwelling prices."

Houses took a median 42 days to sell last month, down from 43 days in January last year.

The REINZ stratified housing price index, which strips out variations in the mix of high and low-value homes sold, rose 7.5 percent from January 2014 to 4,037.3. The Auckland index gained 15 percent, the Christchurch index rose 4.5 percent and the Wellington index was up 3 percent.