Residential property prices have stabilised following three months of steady asking prices but the traditional spring market recovery is predicted to be only mild this year.

The average asking price for New Zealand residential properties was unchanged in August from the previous month, according to the latest research from real estate listings website realestate.co.nz.

In August 2009, the average asking price was $397,000, a slight rise from $396,000 in July and compared with $403,000 in June 2009.

“This reflects a stable market with no signs of heated property price inflation,” realestate.co.nz chief executive Alistair Helm said.

Barfoot & Thompson director Peter Thompson told NBR prices have been “fairly steady” over the last quarter.

But with only around 10,000 new houses coming on to the market each month, there is a shortage of new listings.

“The big thing has been the lack of listings. Its giving people fewer opportunities,” Mr Thompson said.

Harcourts International managing director Mike Green said that the shortage of listings could lead to prices being pushed up.

“Many would-be sellers were advised six months to a year ago that they should hold onto their homes and ride out the global financial crisis if they could, to avoid receiving a lower price or having their property sit on the market for months with very little interest,” Mr Green said.

 “Rather quickly the situation has changed and the fewer properties that are on the market are often receiving multiple offers, with some selling over the asking price. Auctions are also achieving great success in many marketplaces.”

Historically, the real estate market picks up in Spring. This year, however, the rise is predicted by some to be slight.

“Because of the weather, we traditionally get more activity during that period particularly from generally higher priced properties with swimming pools, which look nicer in summer and spring than winter,” Mr Thompson said.

“This year I am expecting to see the average price to rise just very slightly going in to spring but not much more than 2-3% over the coming months.”

Mr Helm confirmed the traditionally anticipated “pickup” had failed to materialise so far, but said sellers could be encouraged to increase prices if the shortage of listings continued.