Published Monday, 16 November 2009
But experts warned the market remained fragile with a relatively low number of properties being sold.
While house prices fell by up to 25% over the year, there were signs of an evening-off after the average figure rose by 2.1% in recent months.
Their latest Quarterly House Price Index showed the average house price was just over £164,000 in the third quarter, a rise on the figure of £158,886 for the second quarter.
The report's authors said: "The recovery in the housing market is still piecemeal.
"Positive signs are the declining rates of annual price decrease across the different sectors of the market and an overall weighted increase over the last quarter of 2.1%.
"But sales transactions, at best, are only a third of the volume expected under normal conditions, suggesting that the market still has some distance to go."
The report covers about 120 estate agents and records all open-market transactions.
The average house price in the third quarter this year was £164,017 compared with £203,775 in 2008.
This represents an annual weighted decline of 19.2%. The annual rate at which house prices are falling is therefore continuing to slow down, from 29.5% in the second quarter this year and 35% in the first quarter.
According to the authors, the downward trend may have run its course and the market could be entering a phase characterised by small fluctuations in average price levels.
The survey also indicated improving levels of affordability. Nine out of ten houses sold at or below the £250,000 mark.
Housing Executive Head of Research Joe Frey said the signs that the market might be stabilising were welcome.
But he added: "Perhaps in future lenders and investors will heed the clear warning signals more closely and help minimise the risk of any future unsustainable housing boom in Northern Ireland."
- In Belfast the average price of housing at £176,418 was down 27.9% over a year. Compared with the second quarter, however, there was evidence of further improvement with the overall average price up by 7.6%.
- For Derry/Strabane the overall average price fell by 29.7% over the year to £147,000, similar to the annual rate of decline observed in the previous survey. Over the quarter there was a 6.6% decline in the average price.
- The overall average price for Mid-Ulster was £143,296, a drop of 12.8% over the year compared with rates of decline of 16.3% and 31.8% in the previous two surveys.
- In Enniskillen/Fermanagh/South Tyrone the overall average price was down 12.7% to £147,577 which, compared with previous surveys, pointed towards improved market conditions. But over the quarter, average prices were lower overall by 8.6% suggesting the recovery will be highly variable.
- For Craigavon/Armagh, where the overall average price was £118,600, the annual rate of decline reduced to 27% compared with 35.6% in the previous survey. Over a quarter, performance indicated potential improvement with the average sale price down by only 0.5%.
- In Mid & South Down, the average price of £160,147 was down by 26.3% over a year, similar to the position in the previous survey.