ANY house price increases in 2006 were wiped out by the downturn in the market over the past 12 months, a new report claims.
And the value of some second-hand apartments in Dublin have plummeted by up to 17pc.
Despite this, the Irish Auctioneers and Valuers Institute (IAVI) last night insisted: "The worst is over."
Property owners in the capital were worst hit by the downturn, with second-hand apartments down 17pc and house prices down 10pc in 2007, according to the IAVI annual review.
And, with an estimated 40,000 apartments still vacant in the capital, the institute predicted that prices will continue to fall in that sector.
Despite also predicting a 4pc slide in property throughout the city and a 3pc fall elsewhere, IAVI president Robert Ganly was relatively upbeat about the coming year.
"Overall, I would say to people that the market is beginning to stabilise. The worst is over," he said.
However, the IAVI expressed concern that prices have "someway to correct before activity is restored and prices are stabilised".
According to the review, house values began to fall last February, with excessive price expectations, the rising burden of stamp duty and the tone of media comment all having a negative impact on the market.
Mr Ganly said the results of the survey made for tough reading but did show that the worst of the current difficulties in the market had passed.
"We are able to predict that prices will fall in 2008, but not by nearly as much as they did in 2007.
"This levelling off should begin to reverse itself in early 2009, and we would hope to see the property market growing again some time during that year," he said.
During the past 12 months, prices for residential sites fell strongly in Dublin by 16pc-19pc and in Munster by 9pc-11pc, but more moderately in Connacht by 6pc-8pc.
In a detailed analysis of property market trends, the IAVI said "tighter monetary policy conditions and growing concerns about overvaluation in the market" caused the drop in demand, particularly from investors.
With 216,000 units vacant around the country and a further 40,000 apartments vacant in the capital, the IAVI believes prices have someway to correct before activity is restored and prices are stabilised.
Commenting on over-inflated prices for property, the review said: "Those members who persisted in creating unrealistic expectations amongst their clients were... punished."
The barrier expense of stamp duty was blamed for "the collapse in transaction chains in the middle to upper end of the residential market where the tax is most burdensome".
The IAVI said this effect was most visible in the capital, due to the higher property prices there.
Political uncertainty regarding reform also played a role in slowing market activity but the Government decision to reduce the stamp duty burden for second-hand buyers has provided assistance, "albeit of a limited and overdue nature", the IAVI said.
Overall, the IAVI review is optimistic about the coming months, declaring that "despite turmoil in credit markets, real economic growth is likely to remain solid in 2008".
The institute also believes that interest rates will peak soon and then fall.