According to the Halifax house price index, the average UK property value dropped 0.2 per cent to £237,808 last month but this was an improvement on the 0.6 per cent fall in April.
The value is down 1.1 per cent on the recent high of £240,461 recorded before the coronavirus hit in February, but encouragingly remained 2.6 per cent higher than May 2019.
However, the lender emphasised that with the significant fall in the number of transactions its index was likely to show greater volatility.
Other house price indices, including the official national one from the Office for National Statistics and Land Registry have been suspended during the crisis because of the lack of transactions.
The figures are also a notable contrast to those from Nationwide Building Society earlier this week which recorded a 1.7 per cent fall in May, the sharpest monthly drop since February 2009.
However, industry commentators have suggested a strong rebound to the market since the restrictions were lifted, with most deals that were put on hold completing and only limited renegotiations.
Halifax managing director Russell Galley noted it was the third successive monthly fall, though more modest than in April, and reflected a continued loss of momentum after a strong start to the year.
“It should still be noted that with a limited number of transactions available, calculating average house prices remains challenging and increased volatility is to be expected,” he said.
“The mid-month relaxation of restrictions in England, allowing estate agents and conveyancers to restart operations, brought much-needed positive news with some advance indicators of buyer and seller interest quickly showing signs of improvement.
“This is likely to provide a short-term boost as buyers and homeowners attempt to kick-start transactions that had previously been put on hold.”
Galley added that he expected market activity to increase progressively as restrictions were eased further and it had confidence in the long-term underlying health of the housing market.
He continued: “However, the extent of downward pressure on market confidence and prices over the coming months will depend on how quickly the economy is able to recover from the effects of the pandemic and the available government policy support for jobs and households.”