Luxury commuter belt house prices grow faster than central London homes

Comparatively, prices in the affluent boroughs of Belgravia, Kensington, Chelsea, Knightbridge and Mayfair rose just 4.9pc.

Savills’ latest Prime Regional Index showed that the strongest house price growth was in the suburbs within the M25, such as Esher in Surrey or Rickmansworth in Hertfordshire, reflecting the flow of London’s domestic wealth into the commuter markets as they capitalise on ten years of frenzied house price growth in inner London.

“The prime market is responding to the positive sentiment in the mainstream market, with stock levels increasing as downsizers in particular sense an opportunity to sell in a more buoyant market,” said Lucian Cook, head of residential research at Savills.

However, the recovery is more tentative in other parts of the country, particularly in Scotland where prime property prices are still 21pc lower than at their height seven years ago. The forthcoming independence referendum is causing some uncertainty, particularly among English buyers looking to invest in a higland retreat.

The renewed spectre of a mansion tax is also deterring some potential movers across the UK until the political agenda becomes clearer.

The report also showed that buyers are favouring urban homes over country pads.

Prime properties in regional cities saw growth of 1.7pc in the three months to the end of June with annual growth totalling 8.1pc.

This compares to quarterly growth of 0.9pc for village properties and 0.5pc for prime properties in rural locations, and annual growth of 5.3pc and 3.3pc respectively.

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