The number of properties for sale reached a record high in several regions in March, while reports of a potential market price correction saw an increase in demand, according to the latest Trade Me Property Price Index.

Trade Me property sales director Gavin Lloyd says all 15 regions saw supply increase last month when compared with March 2021, and the month prior.

"Nationwide, we saw a 13 per cent jump in the number of properties for sale when compared with February."

Gavin says last month's largest supply spikes were all in the lower North Island.

"In March we saw the largest number of properties for sale on record in the Wellington, Hawke's Bay, and Manawatu/Whanganui regions. Otago also saw an all-time high number of listings.

"The number of properties listed for sale nationwide last month was the most we have seen since May 2019, before the market felt the impact of the pandemic."

Demand spikes across the board in March

Gavin says while nationwide demand for properties for sale dropped by one per cent year-on-year in March, monthly comparison showed a spike in the number of Kiwis looking at property listings onsite.

"In March we saw a sharp increase in the number of Kiwis looking at properties in every region across the country, with a 14 per cent total increase in views when compared with February.

"We reckon this is likely a reaction to Kiwis hearing reports that the market might be slowing down and that it could be a good time to get a foot on the property ladder."

Gavin says the largest increases in demand when compared with the month prior were seen in the Nelson/Tasman (20 per cent), Auckland (19 per cent) and Taranaki (17 per cent) regions.

National average asking price reaches a new high

Despite the increase in supply, Gavin says the national average asking price reached a new record of $971,450 in March, up 21 per cent year-on-year and seeing no change when compared with February.

"This marked the sixth consecutive month where we saw a year-on-year increase of over 20 per cent.

"Every region except the Bay of Plenty, Hawke's Bay, Marlborough and Otago saw a record high average asking price in March, with the largest annual increases seen in Canterbury (up 32 per cent) and Taranaki (up 31 per cent)."

Gavin says Southland had a standout month, entering the $500,000 bracket for the first time with an average asking price of $500,900 in March.

"What this is telling us is sellers' expectations have not shifted and most are still holding on to hope that their property will fetch top dollar. "