House prices slipped by 1% in March following five consecutive months of growth, according to new figures from Halifax.
The lender said affordability remained a challenge for potential buyers as recent declines in mortgage rates have stalled.
It comes as financial markets become less optimistic about the timing and extent of interest rate cuts by the Bank of England this year while core inflation remains "sticky", commentators said.
Halifax is the second major lender this week to suggest house prices have fallen month-on-month.
Separate figures from Nationwide, the UK's largest building society, found they fell 0.2% in March but grew 1.6% year-on-year.
Halifax said a typical home cost £288,430 in March - around £2,900 less than the previous month.
However, it said house price growth was up 0.3% annually and up 2% on the previous quarter.
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Kim Kinnaird, director of mortgages at the bank, said: "That a monthly fall should occur following five consecutive months of growth is not entirely unexpected, particularly in view of the reset the market has been going through since interest rates began to rise sharply in 2022.
"Despite this, house prices have shown surprising resilience in the face of significantly higher borrowing costs.
"Affordability constraints continue to be a challenge for prospective buyers, while existing homeowners on cheaper fixed-term deals are yet to feel the full effect of higher interest rates.
"This means the housing market is still to fully adjust, with sellers likely to be pricing their properties accordingly."
She added that while underlying demand was "positive", the market "remains sensitive to the scale and pace of interest rate changes".
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Guy Gittins, chief executive of estate agents Foxtons, said: "House prices have continued to creep up since the start of the year and this improvement in market health has been driven by the returning appetite of UK homebuyers.
"While higher mortgage rates certainly remain an obstacle, there has been a dramatic increase in buyer activity levels and it's not just in the form of enquiries and viewings, with more offers also being made.
"With the general expectation that interest rates are set to fall sooner rather than later, we anticipate that market conditions will only continue to improve as buyer confidence builds."
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Imogen Pattison, an assistant economist at Capital Economics, said: "Looking ahead, we expect mortgage rates to remain higher than in January and February and hover at just under 5% over the coming months, which will subdue demand and prevent further gains in house prices.
"But given public house price expectations are positive, we doubt prices will fall much either."
It comes as Rightmove said the Thursday before the Easter bank holiday weekend was its third biggest day for new property listing since August 2020.
The firm's Tim Bannister said: "It's still a price-sensitive market, so, while the uptick in activity we've seen over the past few months is a positive sign, sellers still need to heed the advice from their agent on pricing competitively to help secure a successful sale."
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