Villa reached rock bottom with that drubbing in the Barclays Premier League with Houllier accusing his players of giving up without a fight. But it proved to be a turning point as Villa have lost only two of their 11 league and cup matches since that day of humiliation.
Houllier said: "It was the poorest performance of any team I have had in my life. There was no soul, no attitude. In sport, you can be beaten but you never give up. It was the low point of my career. I never in my life, never, had a team that has given up so quickly."
He added: "We looked resigned to things rather than trying to fight to get back into the game. We hit rock bottom there."
Houllier never doubted he would be able to revive Villa's fortunes with the support of club owner Randy Lerner and chief executive Paul Faulkner.
He said: "I knew I would turn things around, because I had the faith of the chairman and the chief executive. We work closely together. It was just that I was too soft in trusting players too long. That is probably what happened.
"We recovered after that. We have only lost twice since that, home against Sunderland when we were down to 10 men and away to Manchester United away when we played well. Ever since that Manchester City game, we've started to build and improve."
Houllier points to a 1-0 home success over City in January as the springboard for Villa's upturn in fortunes.
He said: "We were a bit lucky. Honestly they were better than us. We managed to get an early goal and we hung on. We had a couple of chances but they were superior to us. But that performance was the starting base because the team stuck together more and held on for the result.
"We have improved physically and mentally. We have improved as a team. The squad lives together better. They realise it is not just 11 players and the rest. We have quality everywhere. We also improved in the ball retention, passing and movement."
Source: PA
Source: PA