Ray White, the country's largest real estate and property group, says that there is still a shortage in properties and housing in Australia. But the group also marked positive sales. Ray White recorded an eight per cent sales increase on May.

May sales totaled to $2.61 billion which is eight per cent higher than the same month in the previous year, the property and brokerage group said in a statement on Friday.

The company's branch in Double Bay in Sydney recorded the highest sales of $123 million.

The group's sales increase was noted despite the six increases on the overnight cash rate between October and May to 4.5 per cent. While the month that followed April sales had declined, sales following the rate increases.

"Despite rates going up, there is still a shortage of properties on the market particularly in the New South Wales and Victoria and when demand exceeds supply that will always boost momentum for sales," said Brian White, Ray White's joint chairman.

The group's New South Wales area sales noted a 16 per cent increase with a record of $840 million over a year earlier. Victorian sales surged 54 per cent to $433 million.

Sales in South Australia and the Northern Territory increased by 15 per cent while sales in Western Australia and Queensland declined.

The Residential Development Council earlier said that the country needed about 200,000 homes to make up for the shortfalls in the past years. About 150, 000 new properties are also needed to keep up with the demand and the rising population.