Trade Me’s January Property Price Index shows the national average asking price has risen to $876,250, up 0.7 per cent compared with the same time last year.

“While 0.7 per cent might seem small, it speaks volumes about a potential recovery of the market this year,” says Gavin Lloyd, Trade Me’s property sales director.

The last time there was a year-on-year rise in the national average asking price was October 2022.

“These are encouraging signs, and with indications inflation is starting to ease, there’s a possibility interest rates could also drop this year, helping to boost confidence in the property market,” he says.

Regional house price increase

The increase in the average asking price was led by regional areas like the West Coast, which rose 8 per cent to $480,250; Taranaki up 3.4 per cent to $682,600; and Otago with an increase of 3.1 per cent to $888,800.

When looking at the major urban centres, prices in the Auckland and Wellington regions continue to decline year-on-year. However, this drop has slowed considerably since last month.

In the Auckland region there was a decline of 2.2 per cent, bringing the average asking price to $1,072,350. Meanwhile, the Wellington region had a drop of 1.7 per cent, with an asking price in the capital now at $845,800.

“In these populated regions, house prices have declined year on year. However, the pace of this decline slowed in February, and they’ve bounced back since their lowest in August 2023,” Lloyd says.

“Over the last six months we’ve observed this drop reducing from around 10 per cent to five per cent, specifically in the Auckland region. If this trend persists, we may see asking prices beginning to show positive movement in the coming months.”

Christchurch properties

While house prices in the North Island regions are still experiencing declines, Christchurch city has enjoyed record highs across properties with one-to-four bedrooms.

Properties with one-to-two bedrooms now boast an average asking price of $544,200, marking a 2.6 per cent increase compared to the previous year, while three-to-four bedroom properties have risen 3.1 per cent to $775,150.

But prices for all property sizes in Wellington city have declined, with those featuring over five bedrooms dropping significantly by 12.6 per cent to $1,314,850.

In Auckland, properties with more than five bedrooms surged 14.1 per cent, boosting the average asking price just above $3 million.

Additionally, there was an uptick of 3.2 per cent in three-to-four bedroom properties, pushing the average price to $1,609,800.

These figures solidify Auckland’s position as the city (as opposed to the region) with the highest increase in the average asking price, rising by 4.2 per cent, Lloyd says.

Housing demand increases

Interest in properties on the market surged once more, showing a significant 14 per cent increase in February compared with January.

Hawke’s Bay (44 per cent) recorded the most substantial spike in demand, likely due to the cyclone last year.

“We saw a big increase in buyer activity last month. Now that people who own rental properties can get tax deductions on their mortgage interest, it might encourage more investors back into the market,” Lloyd says.

Housing supply across the country has also increased with a nine per cent rise in listings on Trade Me compared with February last year.