The latest findings from the Nationwide House Price Survey also show local property prices grew by 9.7% during the last quarter — the best in the UK.

South West England was second to the province at 4.9%.

However, this boost for the local market was tempered by the news that Northern Ireland prices were down year-on-year by 8% — in stark contrast to the 50% increases seen at the height of the boom in 2007.

Martin Gahbauer, Nationwide’s chief economist, said: “The increase represents the first rise in eight quarters and a substantial improvement from the 4.3% quarter-on-quarter fall seen in the second quarter.”

The average house price here is now £147,204, which is quite a bit behind the UK average of £160,159, and shows the extent of prices crashing when it is compared to the £250,000 values achieved locally in the boom years.

However, the news has been greeted by local estate agents as evidence of house price recovery, especially when it is compared to the negative figures in the UK where price growth fell by 3% over the year. “We have now reached the point where a new market has been created from scratch with both buyers and sellers accepting reduced prices of between 30% and 40% off peak 2007 figures,” he said. “This new confidence is reflected in the fact that new properties to the market if priced correctly are selling in bidding situations again.”

The province’s priciest houses are in Belfast with the cheapest in the North West.

During the boom years affordability became a key issue with many first-time buyers priced out of the market as values soared.

Banks responded by launching 100% mortgage products which threw a lifeline to those trying to get themselves onto the property market.

But as prices plummeted, the credit crunch struck and this dealt another blow to those who aspired to home-ownership, with deposits of up to £20,000 required for a starter home.