Credit ratings agency Standard & Poor’s have insisted that house prices have now stabilised in Ireland.
However, they insist that recovery in the market might still be some way off.
The report said that prices had now fallen to a level that meant they were reasonably priced when compared with wages and with rents.
The agency also said they expect economic recovery in the country this year and next, a move it said would support demand for housing.
"The Irish property market will likely continue to stabilise for the next two years, in our view," the analysts said.
"The heavy slump in the Irish housing market appears to have bottomed out," the report states.
House prices rose in the last three months of last year. This was the first time there was rise in a three-month period compared with the previous quarter for almost two years, S&P said.
But recovery is a long way off because of limited mortgage lending by banks and a glut of unoccupied properties.
The introduction of the property tax this year may also act as a drag on the market, according to the report.
"While momentum appears to be building in the housing market, the rate of increase in transactions and housing lending this year may not exceed 2012, as mortgage-interest relief has ended," the report said.
Only Britain and Germany are expected to see house prices rise this year, according to S&P.
