Is this the UK's tiniest house?

A miniature house in North London is up for sale at more than a quarter of a million pounds - despite having just 188 square feet of living space.

With two rooms, the property, in Barnsbury, Islington, may well be the UK's smallest - despite its £275,000 price tag. The bed is suspended in a tiny mezzanine area, accessed by steps leading up from the kitchen worktop. The loo is located actually within the shower. There's a tiny area of outside space to the front - just big enough for five plants in pots.

Despite this, the house is something of a bargain for the area, where prices average nearly £667,000. Former prime minister Tony Blair lived just one street away, in a house now worth several million.

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The miniature house may well be bought as a rental investment. According to agent Winkworth, "The property would make an ideal buy to let or pied-a-terre and provides a creative open plan living space with built in storage, shower room and mezzanine sleeping level."

House price bubble?
In recent months, increasingly tiny properties have come on the market, fuelling fears over a house price bubble. Just last week, we reported on a seven-foot-wide house in Harringay that's currently up for auction - and expected to reach £235,000.

Developers are responding to spiralling house price values - and rents - by carving up properties into ever-smaller flats. Earlier this year, the Daily Mail revealed how "semi-studios" just nine or ten feet square were being marketed at several hundred pounds per month.

But there may be signs of a backlash. Figures published by Halifax today show that house price inflation is easing off - up just 0.1% in August, compared with 1.2% during July.

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"Housing demand is supported by continuing economic recovery, growth in employment, improving consumer confidence and low mortgage rates. Nonetheless, earnings growth that remains below consumer price inflation, and the prospect of an interest rate rise at some point over the coming months, are likely to curb demand," says Halifax housing economist Martin Ellis.

"There are some signs of an improvement in housing supply, both in terms of more second-hand properties coming onto the market and increased numbers of new homes. These trends, if sustained, should help to improve the balance between supply and demand, contributing to an easing in the pace of house price growth."

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