Developer Paddy Kelly's home in Dublin's affluent embassy belt is being sold for €8.1m - almost 20% below the asking price according to financial news agency Bloomberg.
Kelly, whose fortune was wiped out in the 2008 property crash, said only one serious bidder emerged for the house on Shrewsbury Road close to the US embassy in Dublin.
The house is being sold as part of a loan workout with a lender, Bloomberg said.
The five-bedroom property, which includes a tennis court, had been rented to the China's ambassador in Ireland in recent years.
Home prices in Dublin's most expensive areas fell 1.7% in the 12 months to September, according to broker Knight Frank.
Nationally, prices in August rose at the slowest rate in nearly two years, Central Statistics Office figures showed.
Investors have been increasingly wary of Irish homebuilders as the market shows signs of slowing down.
Shares in Glenveagh Properties are down 28% this year while rival Cairn Homes has fallen 27%.
The Irish mortgage market is likely to grow at a slower rate than previously forecast this year, Conall MacCoille, economist at Davy said in a research note today.
"Recent out-turns have been a little weaker than our previous projections," he said.
"There is also a risk that Brexit uncertainties will temporarily hold back housing market activity next year," the economist added.