Median house prices are starting to fall throughout the country as the residential property market shows increasing signs of cooling.

According to the Real Estate Institute of NZ, the national median selling price was $490,000 in January. That's down from $516,000 in December, and down from its peak of $520,000 in November last year.

In Auckland the regional median price declined to $805,000 from $840,000 in December and $851,944 in November.

One of the biggest declines was on the North Shore where the median also declined for the second month in a row to $965,000, down from $1.105 million in November.

In Central Auckland, the areas contained within the old boundaries of the former Auckland City Council, the median price was down from $1 million in November to $845,500 in January.

In Waitakere the median has dropped from $780,500 In November to $761,500 in January. In Manukau the median dropped form $845,000 in November to $815,000 in January.

Going against the trend median prices are continuing to rise in Rodney, up from $860,000 in November and to $897,500 in January, and in Papakura/Franklin, where it has risen form $700,000 in November to $715,000 in January, after dropping back to $679,000 in December.

However the price declines weren't confined to Auckland. In Hamilton the median price dropped for the second month in a row, from $527,000 in November to $495,000 in January, while in Tauranga the median took a huge plunge, dropping from $600,000 in December to $540,000 in November.

There was also a big price decline in the Wellington region where the median price dropped from $530,175 in December to $460,000 in November, and there was a smaller fall in Christchurch where the median declined form $455,710 in December to $442,500 in January.

A tough summer?

The latest figures suggest residential property market could be in for a tough summer, with the volume of homes sold in January also down sharply compared to a year ago.

Nationally there were 4307 homessold in January, down from 5048 in January 2016 and the lowest number of sales in a January month since 2012.

In Auckland 1247 homes were sold in January, down 18.3% compared to January last year, and it was the lowest number of sales in the month of January since 2011.

Other cities that recorded declines in the number of homes sold in January compared to January 2016 were Whangarei -30.7%, Hamilton -29.2%, Tauranga -43.5%, Rotorua -43.1%, Hastings -29.2%, Wellington Region -9.9%, Nelson -18.1%, Christchurch -15.9%, Timaru -45.3%, Queenstown -12.5% and Dunedin -20%.

The decline in prices and slump in the numbers of homes being sold looks particularly ominous for the Auckland market because the REINZ reports that the number of homes coming on to the market for sale there is increasing, with the total number of homes available for sale through REINZ members in Auckland at the end of January up 17% compared to January last year.

In a First Impressions note on the REINZ figures, Westpac Acting Chief Economist Michael Gordon said they showed a marked downturn in the market over January.

"While January is typically the quietest part of the year anyway, seasonally adjusted figures point to a renewed downturn after some signs of stabilisatioin at the end of 2016," he said.

"Our research has long pointed to interest rates as the dominant driver of house prices.

"Mortgage rates have been heading higher since November, ending a steady downward trend over the previous couple of years.

"Our view remains that higher borrowing costs will have a more sustained impact on house prices than eany kind of lending restrictions."

See the interactive charts below which track median house price movements in all regions, or click on the link below to read the REINZ's full regional reports:

REINZ Residential Regional Commentary - January 2017.pdf