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New Zealand Auckland Oct Average Home Sales Prices At 22-Month High

WELLINGTON -(Dow Jones)- The number of home sales in New Zealand's commercial capital Auckland remained strong in October and average sales prices reached a 22-month high, a report from a real-estate company released Wednesday showed.

Home sales dipped 5.0% in October to 871 units compared with the previous month but were up 73% on the year, Barfoot & Thompson said in its monthly report.

The real-estate company, which accounts for around 34% of Auckland home sales and 12% of national sales, said average home prices rose 5.8% on the month to NZ$544,745 (US$391,290) and were up 4.8% on the year.

"The prices achieved in October were exceptional, and we have not seen average prices comparable to this since December 2007," said Peter Thompson, managing director of Barfoot & Thompson.

"It is a sure sign Aucklanders have shrugged off their concerns about the future, and are moving forward with their plans around home ownership," he said.

Thompson added that sellers returned to the market "in strength" and it listed 1,676 new properties in October, the highest number in a month since March 2008.

The data confirm recent anecdotal evidence of a recovery in the housing market, which has undergone a significant slowdown since late 2007 as previously high interest rates and the global economic crisis crushed demand.

With the domestic economy slipping into recession last year, the Reserve Bank of New Zealand has responded by slashing rates by 575 basis points since July 2008 to a record low 2.5%.

Last week the central bank switched monetary settings to neutral from an easing bias in recognition of the country emerging in the second quarter from a prolonged and deep recession, but pledged to keep the Official Cash Rate at 2.5% until the second half of 2010.

-By Rebecca Howard, Dow Jones Newswires; 64-4-471-5990; rebecca.howard@ dowjones.com

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