New figures show that residential property prices - at a national level - increased by 2.3% in the year to July.

The Central Statistics Office figures reveal that residential property prices grew by 1.2% in the month of July from June - the fourth month of growth in a row.

Last month's figure compared with an increase of 0.2% in July of last year. Prices had fallen by 13.6% in the 12 months to July 2012.

Today's CSO figures show that property prices in Dublin grew by 3.3% in July and were 8% higher than a year ago.

The CSO said that Dublin house prices rose by 3.6% in the month and were 7.5% higher than a year ago - the biggest yearly increase since June 2007.

Dublin apartment prices were 11.6% higher in July 2013 than July 2012. But the CSO noted that the apartment prices are based on low volumes of sales and suffer from greater volatility.

The price of residential properties outside of Dublin fell by 0.1% in July compared with an increase of 0.3% the same time last year.

The CSO figures exclude cash transactions.

Commenting on today's figures, Investec chief economist Philip O'Sullivan said that the outperformance by Dublin prices reflects a number of factors including elevated rental yields, muted completions activity; and still low credit availability.

''In saying that, anecdotal reports have pointed to double-digit price inflation, particularly for family homes, in parts of Dublin for some time, so we are not overly surprised by some of the above numbers,'' the economist added.

Mr O'Sullivan said he expects to see the two-tier narrative continue to play out, with the still high inventory levels continuing to act as a barrier to a sustained improvement in rural house prices over the coming months.

Merrion economist Alan McQuaid said that the second year-on-year rise in residential property prices in a row is very ''encouraging'' and should send a message to consumers that the housing market is recovering after more than five years in the doldrums.

He said that while there is clearly an urban/rural divide, it would be more worrying if the trend was the other way around given that the greatest mass of people live/work in the Dublin area and the general surrounds.

''The recent signs of general improvement in the labour market and on the jobs front should help sustain the housing market recovery, especially in Dublin, but it may take some time for the rest of the country to pick up,'' Mr McQuaid said.

Goodbody economist Dermot O'Leary said that transaction levels, as indicated by its analysis of the Property Price Register, remain disappointing. He said they indicate that despite the stabilisation in prices seen in the CSO data, activity remains at low levels.

Mr O'Leary said that by using second quarter data, transactions are 14% higher than on the same quarter last year, similar to the first quarter of the year.

''These comparatives will get more difficult in the coming quarters as there was very strong growth in transactions particularly in Q4 2012, as first time buyers rushed to avail of special mortgage interest relief,'' he cautions.