Demand from overseas buyers and a shortage of supply has led to a fourth consecutive month of price rises for prime central London properties.

Prices for homes valued above £1m in the capital rose 1.5% in July, according to Knight Frank, the estate agency. Prices have climbed more than 5 per cent since April, although they have still fallen 14.4% on an annual basis.

Overseas buyers have increased their share by a fifth during the past year, last month accounting for 43% of home purchases.

The market revival has been led by Chelsea and Kensington, where prices have risen by more than 6% since March. Houses have outperformed flats.

Financial Times