Positive endorsement for property market

"After a lengthy cycle of 20 monthly negative PCI readings, the May result is very encouraging for investors and property owners," MPM chief Shaun Riley says.

The PCI is a sensitive measure of the housing market and includes three main factors: changes in the number of houses sold; changes in price, and; the time taken for a house to sell.

In May the PCI was +0.34.

House sales volume, the first measure of the indicator, is going from strength to strength, showing volume is up 44% from in March last year.

The second measure, the average time taken to sell a house, at 42 days was seven fewer than in May last year. Average house prices were at $337,500 in May, down 2.2% from May 2008.

"Taken together, the PCI reading is encouraging as it shows definite signs of the market stabilising after the weakness of 2008," Riley says.

Rents in May were down 0.1% from the same month last year, a slightly smaller fall than in April.

        NZ Property Cycle Indicator (PCI)