The value of the average one-bedroom property in prime London leapt by a total of £62,063 to £502,139 in the last 12 months.
That is a 14% rise across the year, and 6% in the third quarter, according to estate agent Marsh & Parsons’ latest London Property Monitor
It means that a one-bedroom flat in previously unglamorous Shepherds Bush now costs a mighty £499,995.
The dramatic price hike has been driven by the popularity of one-bedroom properties with first-time buyers and buy-to-let investors.
The average property value in prime London is now £1,426,243, a rise of 10.3% over the past year, and £2,040,387 in prime central London, up 8.2%.
Price rises have been driven by low interest rates and Help to Buy, the estate agency said.
The bulk of the increase in one-bedroom flats has come in the last three months, with the average price rising by an extra £29,140.
In prime central London, covering the most expensive areas of Chelsea, Kensington, Notting Hill, Holland Park and Pimlico, the average value of a one-bedroom property has risen to £583,036.
That is a 9% increase in the last year, equivalent to £48,703 in a year.
Peter Rollings, chief executive of Marsh & Parsons, said: “With returns like these, it’s no surprise that people are queuing up to buy prime London property.
"Competition for one-bedroom properties in particular is fierce. Spurred on by the rapidly improved availability of mortgages and low interest rates, first-time buyers are flooding the market in competition for the best properties in this price bracket.
“In addition, one-bedroom properties generate the best rental yields, making them a popular purchase for buy-to-let investors.
"We have noticed many young, would-be buyers adopting more European attitudes to renting, with many choosing to become long-term renters, rather than saving up for a deposit.
"As a result, the value of one-bedroom properties in prime London is shooting up the scale.”
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