The average price of a three-bedroom home in London's most expensive neighbourhoods has increased by £729 a day over the past year, according to estate agent Marsh & Parsons.
The firm said the price rise of 19% since April 2013, to an average of £1.6m was equivalent to £5,120 a week – or eight times the £658-a-week median salary for Londoners.
Overall, the agent said the cost of homes in upmarket London areas including Chelsea, Kensington, Notting Hill, Clapham and Fulham was up by 12.9% in the last year and by 4.3% in the last quarter, to £1.5m, and if growth continued at the current rate the average would reach £2m by 2016.
Marsh & Parsons said it had seen "a huge surge" in the number of UK buyers purchasing prime London property in the last three months, with this group making up 78% of the market. In areas including Kensington & Chelsea, typically a stronghold for overseas buyers, the proportion of purchases by overseas and foreign nationality buyers had fallen to a two-year low of 21%. During 2012 and 2013, overseas and foreign nationality buyers accounted for around 40% of all purchases.
Peter Rollings, chief executive of Marsh & Parsons, said these were "extraordinary times" for the prime London property market. "It's always difficult to call the 'top' of the market. But while comparisons are being drawn with 2007, the current conditions are actually remarkably different," he said. "It's difficult to see how prices can fall while demand for property remains so high. Compared to the same point last year, we have seen a 20% increase in demand and a 25% fall in the supply of property. Prime London is still a strong sellers' market and jackpot prices are fast becoming the norm."
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