Chelsea flat for £240,000... but needs work

If you thought it was impossible to find anything on the market in Chelsea for less than £250,000 then think again.

This property has an SW3 postcode and is up for auction with a guide price of just £240,000.

The only problem is it has remained largely unchanged since the Second World War.

The first-floor studio flat is part of a four-storey purpose-built block set around a landscaped square behind Cheyne Walk.

According to the auction catalogue, the interior decoration is "dated" and needs upgrading.

The property comprises a studio room with a bed recess, kitchen and bathroom. It has a 125-year lease and the ground rent is £250, although this is likely to rise.

The studio, which will by sold by auctioneers Savills on 11 February, and the rest of the block is owned by the Peabody Trust Housing Association. The block, in Lawrence Street, is in desperate need of modernisation and the association needs to sell the flat to finance refurbishment of the remainder.

Auctioneer Chris Coleman-Smith said: "This really is a great find and would make a perfect pied à terre."

A survey of property websites reveals the cheapest flat for sale in SW3 is a one-bedroom flat in Egerton Gardens, which is on the market at £195,000.

It is a third-floor apartment but there are only eight years remaining on the lease.

Noel De Keyzer, of Savills' Sloane Square office, said: "Flats of this kind in Chelsea will always be a good investment because they are scarce, while also being ideal for someone who has a country house but needs a London pad either to buy or to rent.

"If done up nicely, I estimate the auction flat would be worth at least £400,000 in this superb location. I expect it to sell for well over the guide price."