The housing market is sending mixed signals. The number of days to sell continues to rocket, the number of sales has reached a plateau, and sales prices have, to the astonishment of many, rebounded in most markets. Some would like to believe this is the turning point, and that things are on the up again. We would advise caution.

The median days to sell reached 53 over the three months to July 2008, the longest time required since August 2001, according to the Real Estate Institute (REINZ). This is almost double the 30 days required to sell a house in the July 2007 quarter, and is fast approaching the record 60 days to sell endured in the February 2001 quarter.

At the same time, the number of sales remained flat over the last three months compared with the three months to 30 June, at 13,150 sales. This is hardly excellent news. Sales are down 44 percent on the July 2007 quarter, and are at the lowest level since REINZ records began in 1992, but at least numbers have not fallen for an eighth consecutive month.

But it is prices that have got some excited, if only for the fact that the national median for the single month of July was no worse than it was in June. Over the three months to July, the median price was still down $2,000 on the three months to June, at $340,000. But these national medians hide a story. There have in fact been rises in median prices across most regions, with Auckland on its own accounting for much of the decline. Auckland, with its higher-priced properties, has seen sales fall almost 50 percent, meaning that the median and average national house prices continue to fall.

We feel it may be a little early for the optimism displayed by those looking at house prices alone. But there is no doubt that after months of continuously bad news, New Zealand has had a few weeks of welcome good news.

The Reserve Bank made the first of (hopefully) several rates cuts, surprising most commentators by its promptness. Oil prices have fallen dramatically, although one feels this may be just a brief respite until demand by the world’s major users picks up again. Employment figures were better than expected, and of course, tax cuts kick in on 1 October. Meanwhile, wage growth continues, with the highest ever annual rise recorded in the June quarter.

These factors will put more disposable income in pockets and will make houses more affordable. This has sellers and agents hoping that some sort of recovery is just around the corner.