City now face a tough battle just to make the Europa League after collecting only three points from their first five matches.
Hart said Manchester City only had themselves to blame.
"We're very disappointed. We've had a few opportunities in this group when we could have done a lot better," England goalkeeper Hart told Sky Sports 2.
"All the games have cost us. We've lost our two away games and not won at home.
"We led in Amsterdam and led in Madrid. It's been a disappointing campaign.
"We've surprised ourselves in a very, very bad way in this competition."