Annual house prices have shot up by 2.2 per cent but fell by 3.1 per cent in April, according to the latest Halifax house price index.
Halifax reported house prices in the last three months to April were 2.2 per cent higher than in the same three months a year earlier.
However, the research also found house prices were down from the 2.7 per cent annual growth recorded in March.
House prices in the latest quarter, which runs from February to April, were 0.1 per cent less than in the preceding three months from November to January.
This is the third consecutive decline on this measure.
On a monthly basis, prices fell by 3.1 per cent in April, following a 1.6 per cent increase in March - reflecting the volatility in the short term monthly measure.
Russell Galley, managing director at Halifax, said: "Housing demand has softened in the early months of 2018, with both mortgage approvals and completed home sales edging down.
"Housing supply – as measured by the stock of homes for sale and new instructions – is also still very low.
"However, the UK labour market is performing strongly with unemployment continuing to fall and wage growth finally picking up.
"These factors should help to ease pressure on household finances and as a result we expect annual price growth will remain in our forecast range of 0 to 3 per cent this year."
Jeremy Leaf, north London estate agent and a former Rics residential chairman, called the results disappointing.
He said: "Although a little historic, these figures are disappointing as there is a market of sluggish growth and transactions, despite still showing modest price rises.
"And yet we are entering what is supposed to be the busy spring buying season, which tends to set the tone for the rest of the year.
"More recently, activity and listings have picked up but we are finding the market still quite sensitive and only those prepared to negotiate hard are moving on.
"Now that interest rates are unlikely to go up this month, hopefully there will be more interest, and particularly from first-time buyers, to take advantage of competitive mortgage deals and realistic prices."
Mark Harris, chief executive of mortgage broker SPF Private Clients, said speculation over another interest rate rise by the Bank of England meant a number of lenders have raised their mortgage rates.
He said: "All eyes are on the Monetary Policy Committee this week as they announce the latest movement in interest rates, with many predicting that they will rise.
"However, governor Mark Carney poured water on those rumours recently so it may not happen - this time.
"What we have seen is a number of lenders raise mortgage rates in recent weeks on the back of higher Swap rates but they are still very reasonably-priced as lenders compete for business in a fairly subdued market."