There was a sharp fall in the volume of house sales in the third quarter in the North and a slowdown in the rate of price growth, according to a new study.
The University of Ulster Quarterly House Price Index found that the rise in prices from one quarter to the next had slowed to 3.6 per cent in the latest survey compared to the 10.5 per cent in the one three months before.
Co-author Prof Stanley McGreal said: "There has been a clear change of sentiment reflected not only by the reduced rate of growth but a significantly lower sales volume, down by a third compared to the same quarter in 2006.
"In essence, there are still high price levels but much lower growth rates and considerably reduced sales activity."
Nevertheless, with prices continuing to go up, the average cost of a home in Northern Ireland had now passed through the £250,000 mark.
The annual rate of price growth remains substantial - 40 per cent compared to 51 per cent in the second quarter.