The pace of decline in house prices has slowed for the first time in seven months, according to new government data, leading to hope the property prices may finally stablise.

According to the Central Statistics Office prices for homes fell by an average of 16.3 % in the 12 months to March compared with 17.8 per cent in the year to the end of February.

And there was no change month on money there was no change compared with February – the first time this has happened since August 2010.

Figures published by the Central Statistics Office show that residential property prices remained unchanged in the month of March. This compares with a decline of 2.2% recorded in February and a decline of 1.7% recorded in March last year.

Investment analysts however urged caution.

"While these figures are undoubtedly positive in the context of accelerating price falls since late 2010, it is worth noting that monthly price data can be volatile, particularly as the data is restricted to mortgage transactions, and prices have still fallen 4.1 per cent in the first quarter," Glas Securities said.

"Nevertheless, today's release will be welcomed given the high levels of negative equity and mortgage arrears in the Irish banking system, and forthcoming price data will be closely monitored to establish if these figures mark the early stages of a stabilisation in property prices."

In Dublin, property prices were 0.7 per cent higher in March, but remained 18.3 per cent lower than in March 2011.

Overall, property prices in the capital have fallen 57 per cent from their peak level in early 2007. Apartments have felt the worst of the decline, falling by 61 per cent, while house prices have lost 55 per cent of their value.

Nationally prices have fallen by 45 per cent.

Bloxham’s chief economist Alan McQuaid said the March figures were heartening but that he didn’t expect any significant improvement until the job market improved.

“Although the March data are a step in the right direction we don’t see any significant improvement in the housing market until the employment situation gets better and bank lending returns to some sort of ‘normality’, which is still some way off in our opinion.”

Bloxham is predicting a double digit decline in house prices for the year in the region of 15 per cent..