LONDON (AP) - A prison cell-sized apartment without electricity is on sale for 170,000 pounds ($335,000)—another sign that London's property market is booming despite rising costs and stagnant salaries. Anywhere else this dilapidated studio might not have attracted such price. But this is London, where a 77 foot-square former storage room is being marketed as an investment property in the exclusive Knightsbridge neighborhood.
"It's about the size of a ship's galley," said Andrew Scott, the director of Lane Fox, the agency handling the sale. "But it's permanently anchored to one of the wealthiest neighborhoods in the world."
At more than 2,200 pounds ($4,340) a square foot, the mortgage buys a spot within walking distance of tony stores like Harrods and London's iconic Hyde Park. Originally conceived as a maid's room, the apartment at 18 Cadogan Place hasn't been used for years and is littered with trash bags and crumbling paint.
A coffin-sized shower is en suite, and storage is provided by a shallow closet and 10-inch deep shelves cut into the wall. Two hot plates and a small sink make up the kitchen. Two dirty windows allow the light to filter into the basement apartment, and the fire escape could conceivably double as a shared patio.
With no electricity or functional heating, Scott said it would cost as much as an additional 30,000 pounds ($59,000) to make the room habitable.
"It is an investment," he said, as he stretched his arms the width of the room, laying his palms flat on opposite sides of the wall.
The sale of this dark, mildewy room is a small example of the astronomical rise in property values across London, which only in the past year has seen average residential property asking prices rising 22.4 percent to about 356,000 pounds ($703,000) according to figures released Monday by Rightmove, which tracks the British property market.
Prices in London's most desirable neighborhoods have grown even faster, with average house prices in the borough of Kensington and Chelsea—where Cadogan Place is located—rising 61.8 percent over the past year to a jaw-dropping 1.1 million pounds ($2.2 million).
Ultra high end property prices in London are the most expensive in the world, with some recent sales hitting about 3,000 pounds ($6,000) per square foot—making the Cadogan Place studio a bargain by comparison, according to research published last year by CB Richard Ellis Group Inc.
Similar properties in New York can go for about 2,700 pounds ($5,000) per square foot while those in Hong Kong sell at around 2,000 pounds ($4,000) per square foot.
Scott said he already had three offers on the property, which might go to auction. He added that the property's size in the "eye of the beholder."
"If you thought of this as the cabin on a boat, you'd say, 'It's pretty spacious,' " Scott said.
