Iraqi refugees are beginning to trickle home from abroad and other areas inside Iraq, but they represent only a "minute percentage" of the more than 3 million who have fled sectarian violence, a migration watchdog said.

The International Organization for Migration said in a new report on Thursday that internal displacement had slowed in 2007 thanks to improved security, but also as a result of ethnically and religiously mixed neighbourhoods becoming more homogenous.

More than 2 million Iraqis fled to Syria and Jordan and 1.2 million were internally displaced following the bombing of a Shi'ite shrine in Samarra in February 2006 that triggered a wave of bloodletting between Shi'ite and Sunni Muslims.

"Slightly more than half of the internally displaced plan to return home, but as displacement prolongs, this figure is likely to decline, potentially leading to the permanent segregation of communities in Iraq," the IOM said in its 2007 report on Iraq.

It said many of those coming home from abroad were returning to become internally displaced people (IDPs) because they could not safely go back to their home communities or their property had been occupied by others.

Conditions continued to deteriorate for internally displaced Iraqis in 2007, with many living in substandard or overcrowded shelters, and only 22 percent of the 142,000 families assessed by the IOM reported regular access to food.

Health workers and IOM monitors also reported a rise in unattended births, miscarriages and prostitution.

Iraq's Red Crescent Society said in a report at the weekend that 46,000 people had returned to Iraq between September and December 2006, a much lower figure than that given by the Iraqi government, which has been keen to play up the returns.

U.S. military commander General David Petraeus, however, has questioned the government and Red Crescent figures, saying there is no comprehensive database.

The military has pushed the government to establish a programme to deal with returnees, particularly rehousing those who find their homes occupied by others, a potential source of new conflict.

"Despite decreased violence, slowing displacement rates and limited returns in 2007, population displacement within and from Iraq remains one of the largest and most serious humanitarian crises in the world," the IOM report said.

"Displaced Iraqis are beginning to return from abroad and within the country, but currently return figures represent only a minute percentage of those who have fled."

The IOM found that 65 percent of the internally displaced Iraqis it had assessed were either from or within the Baghdad governorate, epicentre of the sectarian violence that has killed tens of thousands.

Most of those displaced within Iraq, nearly 61 percent, were Shi'ites.

It said 59 percent of the internally displaced intended to return home, while 22 percent planned to integrate into the communities they had fled to and 17 percent planned to resettle in another location.