Figures from UK mortgage lender Halifax show that British house prices rose 1.2% in June, their biggest monthly rise since October.
That confounded analysts' expectations for an unchanged figure and left prices 3.5% lower in the three months to June compared with a year ago.
'Low interest rates, an increase in the number of people in employment and some tightening in market conditions earlier in the year are likely to have been the main factors behind the recent improvement in price trends,' said Halifax housing economist Martin Ellis.
He said a slowly improving economy and sustained low interest rates should help to support broad stability in the market over the coming months.
But Mr Ellis warned that the market was likely to continue to face significant headwinds which are expected to constrain housing demand. 'Low earnings growth, higher taxes and relatively high inflation are all continuing to put pressure on household finances,' he said.
