Residential property prices rose by 0.8% in the month of April, new figures from the Central Statistics Office show - the first increase so far this year.

This compares with a fall of 0.5% in March. The CSO said that prices fell by 1.1% in April of last year.

In the year to April, property prices nationwide fell by 1.2%. This compares to a fall of 16.4% in the 12 months to April 2012.

Today's figures show that Dublin residential property prices moved 0.2% higher in April.

Dublin house prices were unchanged in the month, while apartment prices were 2.9% lower when compared with the same time last year.

The CSO pointed out that the low rate of apartment sales results in greater volatility in the figures.

The price of residential properties in the rest of Ireland grew by 1.2% in April compared with a decline of 2% in April last year.

The CSO said that overall the national index is 50% lower than its highest level in 2007.

Commenting on today's figures, Investec economist Philip O'Sullivan said April saw the smallest annual decline since prices (as recorded by the index) turned negative in February 2008.

However, the economist said the headline improvement masks a "two-tier performance" across the country.

"While this was the slowest annual rate of decline for ex-Dublin residential property prices since April 2008, we would anticipate continued downward pressure on prices in rural areas over the coming months as high inventory levels act as a barrier to a sustained improvement in prices. In Dublin and its commuter belt, however, much tighter stock and a superior economic outlook combine to produce a path of least resistance for prices that is higher," he stated.

Irish properties are undervalued - OECD

In its latest economic outlook, the Paris-based Organisation for Economic Cooperation and Development said that Irish houses are undervalued in terms of long term averages.

Ireland is in a group of countries where houses are undervalued and prices are still falling - a group populated by the European countries hit hardest by the crisis, as well as Japan.

House prices differ widely across OECD countries, both with respect to recent changes and to valuation levels.

The change in the real price compared to a year earlier is used to tell whether prices are rising or falling.

For valuation, if the price-to-rent ratio and the price-to-income ratio are above their long-term averages, house prices are said to be overvalued, and vice-versa.

Irish house prices are 15% undervalued on the affordability measure and 12% undervalued on the profitability of ownership measure.

Using these indicators, OECD countries can be roughly placed into five categories:

1 - Where houses appear broadly correctly valued. This category includes the US, where prices have started rising again after a substantial correction; Italy, where prices are falling rapidly; Austria, where prices are rising; and Iceland, Korea and Luxembourg where prices are roughly flat.

2 - Where houses appear undervalued and prices are still falling. This category includes European countries hit hard by the crisis - Greece, Ireland, Portugal, Slovenia, Slovakia and the Czech Republic, but also Japan.

3) Where houses appear undervalued but prices are rising. This category includes only Germany and Switzerland, two European countries where strong growth in household disposable income and favourable financing conditions have boosted prices.

4) Where houses appear overvalued but prices are falling. This category is the largest as it includes many European countries where the post-crisis housing market correction is still ongoing, most notably Spain, but also the UK, Belgium, Denmark, Finland, the Netherlands and one non-European country, Australia. While price corrections in these countries are necessary, they are also concerning as they weaken households' financial health and potentially fragile banking sectors.

5) Where houses appear overvalued but prices are still rising. This is the case in Canada, Norway, New Zealand and, to a lesser extent, Sweden. Economies in this category are most vulnerable to the risk of a price correction, especially if borrowing costs were to rise or income growth were to slow.

In May 2012, the Central Bank published a research note suggesting that house prices in Ireland had at that point "overcorrected" by between 12% and 26%, depending on which one of four measures were used.

Then house prices nationally had fallen by 47% from the peak.