HOMES which were once advertised as the cheapest in the country are now fetching £50,000.

Flats at Hampstead Road, Benwell, in Newcastle, were being sold for 50p each in 1999.

The city council were selling the flats for £1 a pair in a bid to attract more home-owning families into the area.

Buyers had to restore the flats but received a £25,000 grant from the council for doing so.

However, a pair of flats recently sold for £100,000.

The rise in prices is said to be due to the demand for buy-to-let properties to house asylum seekers.

Jonny Wright, who covers the Benwell area for Keith Pattinson estate agents, said: "We all know these flats have been up for 50p and, really, you could not get a better way of showing how the market has improved in this area.

"The whole neighbourhood is on the up and that is attracting investors.

"Just six months ago, they would go for around £70,000 a pair around here, but the demand for them has just pushed the prices right up."

Local landlords are paid £180 a week by the Government's National Asylum Support Service.

One landlord said: "At one time this was first-time buyers' territory but now they don't stand a chance. You need a lot of money to buy a pair of flats here.

"But there is a lot of money to be made from renting them out, and asylum seekers provide guaranteed payments.