Elliot Lipton, son of Stanhope founder Sir Stuart Lipton, has formed a company to provide affordable housing in London.

Lipton claimed that the company, First Base, will be the first housebuilder to focus solely on low-cost housing. The average flat in Greater London sells for £210,000, according to the Land Registry. Lipton said: “We are looking to sell central London one-bedroom flats at around £100,000.”

Lipton said First Base would reduce construction costs by up to 20% without a reduction in quality. The firm is using concept designs by architects Foster and Partners and the Richard Rogers Partnership.

Lipton said: “Our belief is if that if we take the best UK commercial practice and combine it with the best residential practice from around the world, we can lower the price and improve the product.”

Lipton’s venture, in which Stanhope has “a significant stake”, has been launched amid fears of a dip in the housing market. Despite this, Lipton believes First Base will succeed. He said: “I think the state of the housing market shows there is a chronic shortage at the more affordable end where the impact of any market drop will be less.”

First Base is working with housing associations to negotiate the release of potential sites, though no areas have been chosen. Lipton said: “We are still very much at the planning stage but hope to sign the first deals early this year.”