I stayed somewhere like that in Brighton many years ago, only for one night. It was a sort of b&b without the breakfast! Not a problem because there are loads of places in Brighton that serve breakfast. It was £50 a night. The landlord of that place could be on to a winner if he let it out nightly to people visiting London but that would entail more work.
As I said before, there are worse places to let than that studio. If someone just wants a crash pad for a while, it's ideal. Well, maybe not ideal but acceptable.