Listings drop likely to fuel prices

That is adding to pressure on prices in Auckland and Christchurch in particular – and there is evidence that other centres are starting to follow suit.

Yesterday's NZ Property Report, released by Realestate.co.nz, shows that in June the national inventory of homes for sale - the time it would take to clear the existing stock of unsold homes on the market - dropped below 30 weeks, to 29.8, for the first time in four years.

It is well below the long-term average of 41 weeks.

Realestate.co.nz chief executive Alistair Helm said the dropping inventory seen over the past six months has reached a critical point - making it a seller's market right across the country.

Helm said: "Sales of homes are up 20% year on year, but the numbers of new listings just haven't kept pace, so demand continues to outstrip supply. Each of the key regions - Auckland, Wellington and Canterbury - registered some of their lowest levels of inventory on record in June, simply because buyers have been so active."

As well, Helm said buyer demand had pushed inventory in regions such as Waikato, Hawke's Bay, Wairarapa, Otago, West Coast and Queenstown to levels below their long-term averages.

Helm said: "With inventory levels so low, not one region of New Zealand can now be described a buyer's market, even though buyer demand is what's driving the market activity."

He said while the pre-winter surge of new listings that was registered in May tailed off  in June, with levels falling 16% from the previous month to 9689, it had not been significant enough to boost inventory in the face of the high demand.

He also said that while the high demand for homes helped push average asking prices up to record levels last month, seller expectations balanced out somewhat in June, with the seasonally adjusted average price falling slightly to $424,315.

"It will be interesting to see how the ongoing demand for property affects asking prices over the remaining winter months. Although it's been cold, home hunters are still on the trail of hot property and that will no doubt continue to be on sellers' minds."