British house prices rose by 1.2 percent in June from the level in May, data from a major home-loans provider showed on Wednesday. However they slumped by 3.5 percent in June compared with 12 months earlier, according to figures from mortgage lender Halifax. \"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,\" Halifax housing economist Martin Ellis said in a statement. \"The market is, however, 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 added in a statement. Halifax, which is part of state-rescued Lloyds Banking Group, said the average house price in Britain stood at £163,049 (181,733 euros, $261,147) in June. The Bank of England is expected to keep its key interest rate at a record low level of 0.50 percent on Thursday and maintain the status quo into next year due to Britain\'s flagging recovery, according to economists.