I have worked from home as a variation on an existing office theme - that's OK. But I think these envelope-filling and use-your-own-telephone 'jobs' are mostly badly paid. sometimes you can get 'home work' involving assembling things, and if you get the whole family involved and do it whilst watching TV you can make a little bit of money.
Why not try setting up a small business - most places have a shortage of domestic cleaners and you can ask £5-6 per hour around here (Devon) so maybe more in London. Then there's personal tutoring - if you have the necessary education. Some people make a few bob out of crafts, eg knitting (especially if you have a machine), making cards, etc. Or there's the ever-present childminding (need to register with local authority and probably get CRBd these days). Personally I would definitely go down the self-employed route.