According to latest annual figures from NHBC, home registrations in the capital rocketed 60% to 26,230 on 2012.
The London led housing recovery has also now reached all parts of the country, with new home registrations in the UK up 28% to 133,670.
This is the highest level since the economic downturn in 2007.
Smaller house builders are also coming out of the shadows as the market improves.
During the second half of 2013 builders have begun returning to the NHBC Register at an average rate of 50 firms per month. The vast majority of these are small businesses building 100 or fewer homes per year.
NHBC Chief Executive Mike Quinton said: “Over the year, we have seen a genuine return of confidence to the industry as builders strive to meet the growing demand for new homes that the UK clearly needs.
“However, let’s be clear that we are not popping the champagne corks just yet.
“This recovery has been from a historically low base. The UK still has a chronic shortage of new homes, with an unprecedented number of young people still living at home and unable to get on the housing ladder.
“There is much work still to do, but the UK’s housebuilding industry is up for the challenge.”
The figures also show a broad-based sustained recovery across England with all regions reporting an increase in house building registrations from last year. Scotland and Northern Ireland also reported year-on-year increases.