Housing experts agreed buyers who were caught up in bidding wars for their home at the start of 2007 could be looking at losses of up to 20% - if they sell now.

The claims follow the findings of the most recent University of Ulster House Price Index which shows prices here plummeting from a peak of £250,000 last summer to £230,000 on average at the end of 2007.

University of Ulster academic and one of the authors of the House Price Index, Professor Alastair Adair, said: "As prices start to fall back, someone who bought at the height of the market last year and are forced to sell now may be in negative equity."

Professor Adair pointed out, however: "The majority of people buy a property to stay in for the medium to long term.

"It is not like buying an investment, such as a share, one day and selling it the next."

A leading estate agent has also claimed negative equity will now be a reality for some local homeowners.

John McLarnon, partner at Ulster Property Sales, Cavehill Road branch, said: "Those who purchased a property at the peak of the boom - about this time last year - could be in negative equity.

"If they bought a year ago, they could be making a loss," he added.

The estate agent pointed out those selling may achieve up to 20% less than the same time last year: " Sellers could experience falling values of about 20%."

And Mr McLarnon said he is advising sellers with houses on the market for up to a year to drop the asking price.

And price slashing has become common practice among estate agents provincewide.

The roller coaster that is the Ulster property market is illustrated by one homeowner who placed his six-bedroom Antrim Road home on the market last summer with UPS.

The refurbished period property was initially valued at £475,000 with a view to sell at £500,000.

Now the vendor has agreed to drop the asking price to £350,000 in a bid to get it sold.

Mr McLarnon said: "House prices were too high and people do sympathise with first-time buyers trying to get started. I think we are seeing the green shoots of recovery and hopefully prices here have bottomed out."