House sellers have dropped their prices to the lowest level since January, as large numbers of houses remain unsold heading into winter, according to a monthly property report.
The average asking price fell 3.6 percent in May to $407,349, compared with April, property website Realestate.co.nz said.
With the large number of houses remaining unsold - it would take 46.9 weeks to sell the 51,980 properties on the market - a tipping point was reached in May where both high inventory and prices were unsustainable, chief executive Alistair Helm said.
"Last year we were in a similar situation, but it was the volume of sales that decreased. This year it's price," Mr Helm said
New listings were up 17 percent on a year ago, but fell 4 percent from April to 11,733.
There had been no evidence so far that the Government's budget on May 20, making property investment less attractive, had had any effect on asking price, he said.
The asking price was up 1.5 percent in May on a year ago, although it was still 5 percent below the market's peak in October 2007.
"While we've not seen a deluge of cheap property for sale, it does appear that we've peaked on price and there's an opportunity here for buyers," Mr Helm said.
Realestate.co.nz is half-owned by the Real Estate Institute of New Zealand, with six real estate companies owning the rest.