London's first new homes for sale for under £200k in four years: studio flats in Romford start at £195,000 — with Help to Buy available

The first new homes with prices below £200,000 seen in London for at least four years go on the market today.

Studios at the Papermill House development in Romford, in the borough of Havering, start from £195,000.

About 1,000 potential buyers have already registered for the 115 flats available, which all qualify for the Government’s Help to Buy scheme.

This provides a taxpayer loan for up to 40 per cent of the cost and requires a deposit of just five per cent.

This would mean buyers only having to find £9,750 upfront with initial monthly mortgage repayments of only about £500 on a 35-year loan.

Developers Galliard Homes had originally intended to rent the furnished apartments at the former company headquarter building, but decided to put them on the market because demand has been so resilient.

Interest has been further boosted by the Government’s stamp duty holiday to support the property market over the winter.

Rising prices in the capital means finding a home in a London borough for less than £200,000 has become virtually impossible. Property portal Rightmove lists only about 250 properties currently on the market if retirement flats and houseboats are not included.

The six-storey building is on the site of a former flour mill, but dates from 1975 and was the former headquarters of post-franking machine-maker Neopost. The smallest studios are about 300 sq ft, valuing them at about £640 per sq ft. One-bedroom flats are priced at between £220,000 and £250,000.

The flats are all on sale on 999-year leases with a ground rent of £195 a year and annual service charge of £1,131.

David Galman, sales director of Galliard Homes, said the homes were likely to be snapped up by young professionals from the area. He said: “You can virtually put the deposit on a credit card.”

He added: “We were going to hold on to it ourselves as a rental proposition but things picked up so fast over lockdown we decided ‘let’s put this on the market.’

“Help to Buy and the lack of stamp duty means demand has been pretty strong. You would never have thought we would be where we are six months ago.”

He said Galliard, one of London’s biggest developers, had not sold new homes below the £200,000 mark since 2014 when it priced studios at a scheme in Hayes for £175,000.