On average, London houses closest to Circle line stations are the most expensive, while a property near a Central line station will be cheaper.

Robert Gardner, Nationwide’s chief economist, said: “As the London Underground celebrates its 150th anniversary, Nationwide has found that living close to a tube or railway station can demand a hefty premium on the price of a house, after taking account of other property characteristics, such as property type, size and local neighbourhood type.”

According to Nationwide, a property located 500m from a station attracts a 9% price premium (approximately £26,000 on a typical London home) over an otherwise identical property 1,500m from a station.

This price premium is two percentage points higher than when a similar research was conducted in 2010, where the data suggested a 7% premium.

The London Overground link has provided a boost to house prices in Southwark.

This comes as a recent report highlighted that the demand for prime property in central London is slowing down, according to Knight Frank’s latest Housing Market Forecast.

Liam Bailey, Knight Frank global head of residential research, said: “The demand for luxury London homes from overseas buyers looking for a safe-haven for their money, as well as a slice of London life has helped drive price increases.

“The weakness of the pound makes the investment even more attractive, particularly for those buyers who have currencies pegged to the US dollar.

“This growth might have continued into next year, albeit on a more modest basis as prices bumped a ‘natural ceiling’, but government policy is set to have an impact on the market next year.”

Across the UK, average house prices would take another six years to reach their 2007 peak or 2031 in real terms, the report predicted. It suggested house prices would fall by 2% this year before a modest rise in 2014 which would mark the start of the recovery.