House prices fell 0.8% in February

The average cost of a home fell 0.8 per cent last month, bringing to 1.5 per cent the reduction in house prices for the first two months of the year.

However, the latest Permanent Tsb/ESRI House Price Index appears to indicate a slowing in the rate of decline in house prices, as the monthly average fall in the last quarter of 2007 was closer to 1.3 per cent.

For the year to February 2008 house prices were down almost 9 per cent. the survey found. In February the average price paid for a house was €283,650, with homes in Dublin selling for an average of €390,877, down 1.1 per cent in the month.

Buyers were paying an average of €243,826 for a house outside Dublin, down 1.3 per cent on the month and 8.9 per cent in the year.

Niall O'Grady, Permanent Tsb's marketing manager, said the rate of price decrease over the first two months of the year "is lower than many people might have expected".

He suggested that sellers "are finally grasping the point that people are interested in buying properties if the prices sought are realistic."

First-time buyers were paying an average of €254,697 for a property in February, down 1 per cent on the month and 8.9 per cent on the year. Second-time buyers were paying an average of €317,970, according to the survey, a fall of 0.4 per cent in the month and 8.8 per cent in the year.