Northern Ireland is now the only part of the UK in December where property cost less than it did the previous year, new Government figures show.
However, the annual rate of decline eased to 6% during the month, down from 10.5% in November.
Overall, the UK housing market as a whole continued to show signs of recovering during December with prices rising by 0.8%.
The increase pushed Britain’s annual house price growth further into positive territory, with prices 2.9% higher than they had been a year earlier, up from an annual gain of 0.5% in November, which was the first positive figure since June 2008.
But the figures from the Department of Communities and Local Government also showed a slow down in the rate at which UK property values are rising.
The key three-month-on-three-month growth rate, which is generally seen as a smoother indicator of market trends, eased slightly to 2.9% during the final quarter of the year, down from 3.1% in the three months to the end of September.
Despite the recent strength of the housing market, economists are continuing to predict Britain’s recovery will run out of steam during the second half of this year, with many expecting further price falls.
Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors, said: “The latest data on house prices from CLG provides further evidence of the recovery in the residential market.”
He said the fact that mortgage availability was improving and rates were coming down should continue to push house prices higher for at least the next few months.
But he added: “Although things are looking better at the moment, the second half of the year is likely to be more challenging again.
“As a result, we suspect that the price trend is likely to stabilise and possibly turn down in the latter part of 2010.”
The annual rate of house price inflation improved in all regions of the UK during December, the CLG figures showed.