But beneath the headline figures is a much more striking picture of huge contrasts between different parts of the capital.
Prices are soaring in certain postcodes, particularly in the south and east of the city, while they have plummeted in other areas.
Southwark saw the biggest rise in property prices of any London borough in the 12 months up to December 2018, with a 4.7% increase taking the average home just over the half-a-million pound mark.
Southwark, one of the most central south-east London boroughs, includes London Bridge, the Shard and parts of Dulwich, Peckham, Bermondsey and Elephant & Castle.
Strongest house price growth was in Northern Ireland (5.5%), Wales (5.2%) and West Midlands (5.2%).
The weakest growth was in the North East (-1.0%) and London (-0.6%) https://t.co/bCjfOg6tfy
— ONS (@ONS) February 13, 2019
Other further out south-east London boroughs also featured in the 10 districts with the fastest-growing prices, including Lewisham, Bexley and Greenwich.
Barking and Dagenham in east London saw the second-highest growth at 3.5%, followed by Redbridge and Ealing.
The City of London also featured in the top 10 for growth, but the City of Westminster found itself at the bottom of the table.
Westminster, which includes the Houses of Parliament, the West End and shopping hubs like Oxford Street, recorded a 10.1% drop in prices.
The average Westminster property remains out of reach for the vast majority of Londoners, but it saw a significant drop below the million-pound mark to £986,000 in December.
Tower Hamlets in east London, which includes the East End and landmarks like Brick Lane, also saw a huge 8.2% drop in prices, taking the average home to £427,000.
Islington, Brent, Hounslow, Harrow, Haringey, Camden and Hammersmith and Fulham also saw more than 1% shaved off average property values last year.