London is continuing to benefit from concerns about the health of the eurozone economy as well as wider geopolitical fears, although other forces have shown some cooling effect.

London is continuing to benefit from concerns about the health of the eurozone economy as well as wider geopolitical fears, although other forces have shown some cooling effect, figures from Knight Frank show.

The Knight Frank Prime Central London Index in August rose by 0.3 per cent month-on-month and rose 7.7 per cent on August of 2013, the global real estate firm said yesterday.

The average sale price in prime central London between June and August 2014 was £4.7 million ($7.6 million) up from £3.7 million in the preceding three-month period.

“The 27 per cent increase underlines how a growing group of vendors are adjusting to  the fact demand is cooling, the result of uncertainty surrounding a future interest rate rise and the outcome of next May’s general election.

Tom Bill, head of residential research at the firm, said: “Though fears over the future of the eurozone have receded, a faltering economic recovery in the region has seen the re-emergence of safe-haven flows into London.”

Knight Frank said Italians were the biggest group of overseas buyers between January and August, accounting for 6 per cent, followed by French (4.1 per cent) and Russian buyers (3.8 per cent).