New Zealand's housing market continued to strengthen in December, with several regions hitting new record prices, while Auckland lagged behind following restrictions to curb activity in the country's largest city.

Median house prices in Auckland rose just 0.7pc in December, while sales volumes were down 11.5pc.

Auckland's property market has showed some signs of slowing after the Reserve Bank and the government last year introduced new measures to quell the risk from a housing bubble, as migrants and investors competed for a shortage of housing stock.

While Auckland house prices advanced in the past two months, the latest $770,000 median price is just short of the record $771,000 set in September. Meanwhile, prices outside of Auckland have continued to strengthen, with five areas setting new record median prices in the latest month.

Regional markets, particularly Northland, Waikato/Bay of Plenty, Hawkes Bay and Central Otago Lakes are now setting the pace for the New Zealand real estate market, with Auckland, in a relative sense, now in the middle of the pack," said REINZ chief executive Colleen Milne.

"The decline in sales volume in Auckland, while noticeable, is likely transitory as the region gets to grips with the new LVR rules for investors, although the median price continues to firm," Milne said.

Source: NZ Herald