The ANZ Property Gauges use 10 indicators to assess the state of the property market and look for signs that will impact on house prices.
The bank said that the Canterbury earthquake dented a market already struggling in a deleveraging environment with a slowdown in net inward migration.
Of the ten gauges only two showed a moderately positive direction for rising house prices - the supply/demand balance and consents and house sales.
The supply/demand balance gap was still wide but was closing and at its narrowest point for 18 months while the lack of action in consents and house sales was "drifting down."
Of the remaining eight gauges, five remain in neutral territory, one suggests either neutral or downward movement and two point to lower house prices.
Serviceability/indebtedness suggests downward price movement as interest servicing eases to a five-year low.
Liquidity also pointed to downward momentum as measured as a ratio to GDP, credit has all but stalled.
Affordability pointed to neutral or downward movement, with the bank saying affordability is at its best level for 12 months.
Interest rates, migration, globalisation, mortgagee sales and median rent were all in neutral territory.
The bank said net migration is down to its lowest annual total for a year while the globalisation gauge showed house price growth has slowed in Australia, though at 18.4% it still remains four times New Zealand's rate of growth.
Mortgagee sales lifted in July and remain elevated while median rent saw the strongest rate of increase since December 2008.
The bank said the slowdown in net migration, added to factors such as falling sales and average selling prices, the earthquake and the slowing in the economy, suggest there is not a lot of optimism in the housing market at present, though it expects to see a pick up in 2011 as the economy gains momentum.