The chief executive of Haart, which has a dedicated financial and legal services division, has revealed new data suggesting the average London property price reached £501,056 in May.
This was a rise of 26.1 per cent year-on-year, and an increase of 4.3 per cent on the previous month, giving homeowners in the capital an extra £103,761 on average each.
Mr Smith said: “London homeowners will be forgiven for being astonished that they have ‘earned’ an average £100,000 in equity over the past 12 months.
“The way to put the brakes on price growth is to increase supply, but in London we have only seen new property instructions rise 0.2 per cent a year and new properties for sale across the UK as a whole are down 1.7 per cent.”
He added that even mortgage market review rules cracking down on affordability had not dampened demand.
Jonathan Harris, director of London-based Anderson Harris, said: “An increasing number of people are worried about the double whammy of overpriced property and the impact of an interest-rate rise, creating a softening in lending volumes.”