London has seen a dramatic growth in the number of very rich households and very poor households over the last 30, meaning the “middle” has been squeezed.

New analysis of Census data shows the changes in London have been the most exaggerated in England, though polarisation is a country-wide phenomenon.

This split is typified by boroughs such as Tower Hamlets which sees extreme wealth, symbolised by Canary Wharf, developing right next door to pockets of extreme poverty.

The investigation by the University of Oxford, funded by independent charity Trust For London, shows in London from 1980 to 2010 there was a:

80% increase in poor households (from 20% to 36%)

43% decrease in middle households (from 65% to 37%)

80% increase in wealthy households (from 15% to 27%)

A third of households in outer London are now rich because they either own property or have paid off much of their mortgage.

Less than a fifth of households in Inner London are rich because so many of them rent and, for those who do own a house, they often have huge debts because they have not yet paid off much of their mortgage.

The largest percentage point increase in poverty has been in Newham, where almost one out of every two households is now poor.

Director of policy and grants at charity Trust For London Mubin Haq said: “Whilst there are staggering levels of wealth in London, many are also on the breadline.

"Too often the headlines are about the capital being the playground for the super-rich, which masks the increasing poverty many face. In 12 of the 33 boroughs in London the poverty rate doubled from 1980 to 2010.

“The net result of the growth in poverty and wealth is a big reduction in households in the middle. This is worrying for those who want a capital city that accommodates all diversities.

“A significant factor is the cost of housing and our attitudes to property ownership. We must build more genuinely affordable homes and make it more difficult for the wealthiest to buy up houses solely as an investment opportunity.”