Otago's prospective home owners are experiencing the side effects of a drop in the number of properties for sale.

The median price rose by more than $13,000 compared to May last year, with prices rising 8% in Dunedin.

Sales across the region for May rose 32%, up almost 40% in Dunedin alone.

Regional commentator Liz Nidd says the region only has 11 weeks of inventory on hand.

She says it's unlikely the supply situation will ease until spring at the earliest.

A buoyant housing market is helping to keep retailers busy around the country.

New data shows the value of spending through Paymark was 4.7% higher in May compared to the same time last year.

The data also shows a correlation between home loan growth, and spending at housing-related retailers such as building supply shops and furniture stores - home loans grew by 10%, and housing-related spending by almost 15%.

Enterprise Dunedin is set to spend an additional $300,000 a year to entice more people to move South.

The allocation is on top of the existing international tourism budget, and includes $100,000 for domestic marketing.

The additional $200,000 is earmarked for promotion of the city to Australians.

Staff will work with industry partners on the two year marketing plan, outlining the key goals and objectives for the funding.

This latest push to attract more people to Dunedin follows on from a print supplement targeting Aucklanders earlier this year.

The official cash rate remains on hold at 2.25% despite many economists expecting it to be cut.

Reserve Bank Governor Graeme Wheeler noted that while global financial market volatility has lessened, the economy remains weak.

As a result of the decision, the kiwi dollar rose, hitting a 12 month high of just over US71c.

While customers don't borrow at the rate of the OCR, it has a direct influence on the interest rates on mortgages and the returns on bank deposits.

More than a million dollars in community grants have been allocated to local businesses and organisations.

The Otago Community Trust has given out a total of $1.4m in its latest funding round.

That amount includes several six figure grants to groups around the region including $500,000 for Otago Museum.

The Dunedin Symphony Orchestra and the North End Rowing Club are also benefiting, each receiving $80,000.

Dunedin home values have increased significantly in the past three months, reflecting a similar national rise.

The latest figures from Quotable Value New Zealand show the average price in the city is now just over $320,000.

That's an increase of more than 4% since March.

The national rise over the last three months was 3.9%.

Dunedin valuer Duncan Jack says right now it's a seller's market locally with buyer demand still strong.

Listings, however, are low for this time of year.

The city's seeing a lull in building activity, with fewer consents being issued for new dwellings.

Just 19 planned homes were signed off in Dunedin last month, down from 33 in March and 50 in February.

That's a 33% drop compared to this time last year.

Nationally more houses are being consented although the construction boom is easing slightly.

The most development remains in Auckland, Canterbury and Waikato.

Overall the number of new dwellings being consented annually is at an 11-year high.