According to figures released this week, homeowners who bought property in the Borough of Hounslow a decade ago have seen a 237 per cent increase on their investment.
The Nationwide Quarterly Housing Price Report also revealed the average price of a house in the borough is £295,104, which is 10 per cent up on last year's average in the same quarter.
The average house price for first-time buyers in London is £250,000, compared with the UK average of £181,810. This is part of the reason why London has the highest density of flat shares: it is simply too expensive for many people to buy their own properties.
The London borough with the most expensive average home price is Westminster at £589,101, up 249% from 1997. The borough with the lowest house price average is Barking and Dagenham at £204,367, up 230% from ten years ago.
Annual house price inflation in the capital was nearly 16 per cent last year, the highest it has been since the first quarter of 2003.
Nationwide attributes London's market strength to income growth in the City as well as a steady stream of foreign buyers, who buy up properties and turn them into London flatshare accommodation. The housing price indexer revealed that about half of all people buying houses worth over £2m are thought to come from overseas. The building society said the other reason is an under-supply of houses in London.
Nationwide predicted that interest rates, which are expected to reach six per cent by the end of 2007, would start to cool the property market.
