The rate of increase in the price of houses has continued to moderate with new statistics recording an increase of just 0.4 of a percentage point in July.

The latest edition of the Permanent TSB House Price Index, which is compiled in association with the Economic and Social Research Institute (ESRI), suggests that house prices nationally have risen by 6 per cent since the beginning of 2002. This follows increases of 5.9 per cent in the same period last year.

Over the 12 months to the end of July, the index records a 4.5 per cent increase in house prices nationally.

In the Dublin area, house prices rose by 0.5 of a percentage point in July. In June, the price of houses in the Dublin area rose by 2 per cent with the rate of increase in prices outside the capital declining by 0.3 of a percentage point.

Permanent TSB general manager, Mr Niall O'Grady, said the latest figures showed that while the housing market was very buoyant at the start of the year, there was a clear trend emerging of a moderation in house prices.

The average price paid for a house in Dublin was €252,548 compared with €169,385 outside Dublin. In July 2001, the average price paid for a house in Dublin was €241,484 while home owners on average paid €161,868 outside Dublin.

Both first-time and second-time buyers faced a 0.4 of a percentage point hike in house prices last month. In June, first-time buyers saw the rate of increase fall by 0.1 of a percentage point while second- time buyers experienced a 1 per cent hike.

The average price paid by a first-time buyer last month was €169,259 compared with €216,684 paid by a second-time buyer. The year-on-year growth rate for both first-time and second-time buyers was 3.9 per cent.

The index also points to an 0.8 of a percentage point increase in the price of second-hand houses while new house prices actually fell by 0.3 of a percentage point. In the previous month, second-hand houses increased in price by 1.2 per cent while new houses rose in price by 0.3 of a percentage point.

Year-on-year growth rates for new and second-hand houses were 2.4 per cent and 4.9 per cent respectively.

The average price paid for a new house in July 2002 was €191,142 while that paid for a second-hand house was €196,230. The equivalent prices in July 2001 were €186,643 and €187,053.