House prices keep rising

The national median house price rose to match its November record in February although there are some indications that house price inflation may be moderating.

Monday, March 24th 2003, 6:45AM

by Jenny Ruth

The latest Real Estate Institute (REINZ) figures show the median price rose to $195,000 in February from $193,400 in January. The February price was only 4.8% higher than the $186,00 national median price in February last year

The increase between January’s price and January last year’s was 10.5%.

Nevertheless, in the heated Auckland market the median price rose 8.5% to $280,000 compared with February last year.

There were 9,624 homes sold in February, up from 8,159 in January and 8,733 in February last year. That was still below November’s record 9,932 homes sold.

REINZ president Graeme Woodley says real estate agents around the country are reporting that economic growth and low interest rates are underwriting the market’s confidence and liquidity.

The Reserve Bank’s Official Cash Rate, from which floating mortgage rates are set, has stood at 5.75% since July last year and economists say it may be cut in June. Fixed rate mortgages are also relatively low after global markets pushed wholesale interest rates to record lows in the lead up to US/Iraqi war.

"In Auckland, our agents say it’s very much ‘business as usual’ following the America's Cup, which is encouraging news," he says.

Compared with January, the median price rose in seven of the country’s 11 regions and fell in four. Prices in all regions, except Manawatu/Wanganui where the median price fell from $114,000 to $110,000, were up compared with February last year.

The number of sales rose in 10 of the regions compared with January with the exception being Hawkes Bay where sales fell from 343 to 317. Compared with February last year, activity rose in seven of the regions but fell in the other four.

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