The prime property market is seeing price increases because there is a shortage of stock at the moment, the director of a leading estate agent has stated.

Nigel Ellis, director of Pricket & Ellis, said there is a great demand for properties valued over £600,000, particularly those worth more than £1 million.

This is because there is not enough of this type of property to go around.

However, he warned that this is only a trend and most people are not looking to move because interest rates are low and people are hesitant to borrow more money during an uncertain economic climate.

Mr Ellis was commenting on the new Prime Index by Primelocation.com, which stated that the average prime London property price increased by 0.2 per cent between January and February and 4.5 per cent in comparison to February last year.

He added that if a lot of prime properties came on to the market, there would be a decline in asking prices.

"But in my patch I don't think that's what is happening, no one's having to sell, most people seem happy where they are," he added.