The “prime” regions of London are no longer just the elegant squares of Belgravia, Chelsea or Knightsbridge, as even those areas in and around the City financial district deserve the term, according to Knight Frank, the property firm.

To make the grade as prime areas, a segment must have good levels of top-end housing stock, central locations, good transport links and excellent retail and leisure facilities, Knight Frank said. Its report is called City of London and City Fringe join Prime Central London.

Knight Frank is adding these two areas to its PCL Index, which is watched as a barometer of high-end residential property values.

Bucking a trend in much of the rest of the UK since the 2008 financial crisis, property prices in these prime areas have surged, in part fuelled by money seeking refuge from areas such as the Middle East and North Africa amid the “Arab Spring” upheavals, as well as from Russia and the Far East. Prices have also been boosted due to hunger for “real assets” by investors fearful about the consequences of monetary expansion by central banks.

On the negative side, concerns have been voiced about job cuts in the City, which would dampen some property markets. According to one media report, investment banks are reversing much of the hiring they have done since 2008 as banks conserve capital and cut risk-taking.

Knight Frank said it has expanded the constituents in its prime London index after the firm said that it had earlier this year identified the City as a leading area for residential development over the next five years. It forecast an average rise in prices of 118 per cent by 2016. It predicts household growth in the City Fringe area of 11.9 per cent over the next 10 years.

The “fringe” includes areas around Old Street and City Road, for example.

Since 2001, average property prices in the City of London have zoomed higher by 122 per cent, the report said. Prices in the City fringe have risen by 92 per cent.

To view the full Knight Frank report, click here.