House prices in the Southland region remain strong, but there's not much activity across the market. 

Only 156 residential properties sold in the region last month, including 100 in Invercargill, 35 in Southland District and 21 in Gore. 

That's a 17% drop on the same month last year. 

"These low levels of sales are likely due to the fact that there are fewer properties available," says the Real Estate Institute of New Zealand's new boss Jen Baird.

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"The number of properties available to prospective purchasers decreased 41% year-on-year to a record low level of 219. 

"Investors have been less active in the market during July as they take a wait and see approach to the recent legislative changes."

Baird says there appear to be fewer properties available at the low end of the market. Some 68% of properties sold during July were in the sub-$500,000 bracket, down from 85% in July 2020.

"Activity levels, including new listings, are expected to increase in the coming months as we approach spring and the warmer months."

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The median price across the region hit a record-equaling $420,000 in July 2021, up 17%. 

Gore was the best place to see some capital gains, with prices increasing 43% year-on-year to a median $385k. 

In Invercargill, prices were up 15% on last July, to $425k median. But in Southland District, the median price is down on last July, dropping 3% to $360k. 

Southland region, however, saw the second highest increase in the number of properties selling for more than $1 million, in the first half of 2021.

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Ten residential properties [which excludes farms] breached the million-dollar price, up 400% from the previous six months, according to REINZ's Million Dollar Price Report. 

Eight of the sales were in Invercargill, and two in Te Anau. 

Baird says: "There are a number of factors that have led to the rise of million-dollar-plus properties sold across the country, most notably the ongoing high levels of demand for property combined with the continued slow pace of new listings coming to the market for sale.

"We have also had a low interest rate environment for some time, and we see continued investment in the regions. Regardless of the price bracket, these factors directly impact, lifting the overall market."

REINZ chief executive Jen Baird

Nationally, house prices have continued to rise as every region saw a year-on-year increase from July 2020. 

"The last two months have shown early indications that the rate of growth is starting to ease, however, it is too early to say whether this is the usual winter easing we would normally

see or if the Government’s intervention in the market and signalled changes to the OCR are starting to take effect." 

Every region also reached a record level in the REINZ House Price Index, which takes a more holistic look at the housing market to determine the underlying value of property, rather than monthly sales figures.