The £148million third phase of Barking’s massive Gascoigne East neighbourhood redevelopment has begun with a ground-breaking ceremony, with contractors who have started work on 334 new homes.

Gascoigne is one of London’s largest regeneration projects, aimed at tackling the chronic housing shortage and rent crisis.

Half the new homes under construction for Barking and Dagenham Council will be at 20 per cent discount rent and half will be under rent controls at a maximum of 80 per cent rent compared to the open market.

“This is a commitment to affordable and environmentally-friendly homes despite the tough economic climate,” council leader Darren Rodwell said. “The latest phase of construction shows we are one of the major regeneration players in London.”

The third phase is expected to be completed in 2026. The redevelopment will eventually have 1,700 families whose new homes will be on a district heating system reducing CO2 emissions by 40pc.

The council has so far completed 1,400 new homes since 2017, with another 1,500 currently under way.