Irish average national house prices declined at a slower pace in the second quarter.

House prices in Ireland dropped 1.7% on a sequential basis in the second quarter, a report by the permanent tsb/ESRI House Price Index showed on Thursday. This was the lowest quarterly reduction since the second Quarter of 2008. The latest decline came after falls of 4.8% in the first quarter and 7.7% in the fourth quarter of 2009.

On an annual basis, average national house prices dropped 17% in the second quarter, compared to a 18.9% fall in the previous quarter. A year earlier, house prices decreased 11.6%. For the first six months of the year, house prices slipped 6.4% versus a 8.1% decline in the same period last year.

In the second quarter, the average price for a house in Ireland was EUR 201,364, compared with EUR 242,593 last year. National prices have fallen 35% since the price peak at the end of 2006, the report said, and are now at end 2002 levels.

In Dublin, house prices dropped 3.5% sequentially in the second quarter after a 10.3% fall in the previous quarter. For the first six months of the year, house prices slipped 13.5% over a year ago. Outside Dublin, prices were down 0.8%, following the 3.5% dip in the first quarter. The average price for a house in Dublin and outside Dublin in the second quarter stood at EUR 242,000 and EUR 181,820 respectively.

"While prices continue to fall at different levels in Dublin versus the rest of the country, this reduction in Quarter 2 is the lowest recorded quarterly fall in almost two years," Niall O'Grady, general manager with permanent tsb said. "This may indicate that prices are starting to find a more sustainable level after almost three and a half years of decline"