Cheapest place to buy a home in London: the 10 best value areas to buy property in the capital revealed

They might not be in the most desirable locations, but many are in the midst of regeneration, so patience will be rewarded.
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London house prices may be continuing their slow decline, but – at an average asking price of £619,000 – property in the capital still remains well above budget for many buyers.

However, exclusive research for Homes & Property by Rightmove has uncovered the few remaining neighbourhoods where homes cost less than half the London average.

Even better news is that all these areas are either in the midst of regeneration or have had big money allocated to them for the medium term so a little patience may be rewarded with some serious house price growth.

At the same time, buyers should be aware that not all of these neighbourhoods will pass the ‘pint of milk’ test yet and they may be waiting quite some time for them to pass the gastropub/flat white test.

That said, for those in search of some of London’s cheapest homes with house price growth potential, here are the least expensive places to buy in the capital.

1. Erith, Bexley

With an average asking price of £305,700, the riverfront area of Erith in south-east London is the cheapest place to buy in the capital.

It’s not currently the most prepossessing spot – it's surrounded by sewage works and industrial estates – but you can buy a detached house for under £500,000 and there is change on the horizon.

There are new-build three-bedroom houses for less than £400,000 at The Quarry, which describes itself as an eco-development with 600 new homes, a primary school, park and play areas. Help to Buy is available on the scheme.

In the as yet undetermined medium to long term the area will also benefit from Crossrail stops at Abbey Wood and Woolwich once the new line is finally up and running.

Erith’s western neighbour, Thamesmead, is the second cheapest place to buy in London with an average price of £309,400.

2. Barking and Dagenham

The borough of Barking and Dagenham has held onto its spot as London’s cheapest borough and, with an average house price of £330,700, the town of Barking is the fourth cheapest place to buy in London, after its neighbour Dagenham (average asking price £312,000).

The Zone 4 east London area is the focus of serious regeneration – £2 billion-worth – with its future incarnation variously compared to Barcelona, Berlin and the Riviera.

Barking Riverside is the hot ticket regeneration centre set to get 10,800 new homes, seven new schools and an ecology centre on an old power station site beside the Thames.

The River Roding is also getting a cash injection of £350 million for thousands of new homes along with an Olympic standard gym, a riverside pub, two public squares and a community hall.

You can still buy a three-bedroom Thirties house for £350,000 in the area, with 15-minute trains into Fenchurch Street as well as District and Hammersmith & City line Tubes and London Overground services running to Gospel Oak on the ‘Goblin’ line.

3. Edmonton, Enfield

On the northern edge of fast-changing Tottenham, Edmonton, N18 is yet to experience its neighbour’s change in fortunes.

It is the sixth cheapest place to buy a home in the capital and the only north London area to make the top 10 with an average house price of £342,000.

Edmonton is experiencing the first ripples of the hipster effect with Field Day festival – originally based in Hackney’s Victoria Park – held at Meridian Water, an ex-industrial site in line for a £6 billion regeneration.

Thousands of homes just within the North Circular and next to the River Lee Navigation are promised for this Zone 4 area and there’s a brand new train station, which opened this June with Greater Anglia-operated trains to Stratford in 16 minutes and Liverpool Street in 25 minutes.

Rainham (average house price £339,000) and Harold Wood (£347,000), both in the east London borough of Havering, were the fifth and seventh cheapest places to buy respectively. Chadwell Heath, also in east London, was eighth on the list with homes costing an average of £349,600.

South Norwood in Croydon (£350,470) and Feltham in Hounslow (£350,800) – the only west London area to make the top 10 – complete the list of areas.

The most expensive place to buy in London

While the 10 cheapest places to buy in London were concentrated in the south and east of the city, the most expensive areas to buy a home were predominantly in the west and north.

Knightsbridge topped the list with an average asking price of £3.58 million.

Kensington (£2.06 million), Chelsea (£1.77 million), Hampstead (£1.5 million), and Barnes (£1.4 million) were the remaining five priciest London locations.