What might be called the bohemian tradition in fiction, introduced by 19th-century Continentals such as Henri Murger and Paul de Kock, has never really prospered on this side of the Channel. The average Victorian novelist might have been fascinated by the seedy backdrops of Balzac's Parisian boarding houses, but home-grown attempts to write about out-of-work actors or the kind of people who are permanently two days away from a shave have nearly always been doomed to failure. Looking for an early 20th-century English bohemian, the literary historian tends to turn up specimens such as William J Locke and Leonard Merrick, both of whose reputations have been altogether extinguished by time.

Here and there, however, in the work of half a dozen writers of the immediate postwar period, the bohemian tradition narrowly survives: for example, in the work of Julian Maclaren-Ross, Colin MacInnes and Philip Callow. Malcolm Bradbury has an illuminating chapter or two in Eating People Is Wrong (1959), showing how the whole thing was still going strong in the Midlands coffee bars of the 1950s. (Bradbury even defines a particular sub-artistic group known as the "beets", so called for their habit of earning pin money in the East Anglian sugar-beet harvest.) No doubt it would be stretching things to mark Carol Birch down as the direct heir of this loose assemblage of writers. All the same, the particular social sub-group she writes about - intelligent people with no money living marginalised existences - is so seldom found in British fiction that this kind of taxonomy is more or less inevitable.

The themes of her first novel, Life in the Palace, will be familiar to anyone who has ever glanced at one of its four successors. Broadly speaking, Birch specialises in cool-eyed and battle-scarred women on the cusp of middle age looking back at their past lives with a wary mixture of nostalgia and unalloyed relief. Judy Grey, the first of these veterans from a world of crockery-filled sinks, cut-off electricity and junkies fixing up on the stairwell, is an archetypal Birch creation: an ex-schoolteacher from the north fetched up in "Kinnaird Buildings", a grimy tenement on the Waterloo side of the Thames, full of decayed squats and their equally decaying inhabitants. Here Judy meets a representative of the second type of character in whom Birch specialises: the charming, unreliable man, perennially enticing but with "Must To Avoid" inked all over his shirt-front. Later Birch productions in this line include David, the egotistical poet of The Fog Line (1989), and Michael, who roams unappeasably through her most recent novel, Come Back, Paddy Riley (1999); but Jimmy Raffo is their spiritual grandfather, a chronically wounded Jack the lad whose fractured early life and bouts of booze-addled self-destruction are rendered with a frighteningly dispassionate eye. One can't doubt that somewhere back in time Birch saw most of this happen, and the feeling one gets in her novels of a great deal of uncomfortable personal experience elbowing its way out of a fog of fictionalised incident is sometimes upsetting.

Unsurprisingly - the emphasis being on ground-down interior brooding - not very much happens in Life in the Palace. Loretta, the fat girl made miserable by a string of miscarriages, who works in a central London department store, has her credit-card scam rumbled with unhappy consequences. Raff and Judy reconnoitre each other. Various other denizens come and go. By far the most eerie thing about the edgy communal life coaxed into being here is its other-worldliness, a complete detachment from the bustling world beyond the river. Despatches from civilisation come in tantalising fragments - the sounds of the 1977 Silver Jubilee celebrations drifting across the rooftops, and of a terrorist bomb exploding in the West End. Casually brought into being, the tenement community is just as casually snuffed out by death, bulldozers and dispersal. Judy flees to Euston and the train back north.

I know little about Birch's personal circumstances, but each of her first four novels was published under a different imprint, which doesn't hint at an easy career. Virago's sponsorship of her two most recent books, and this reissue, suggests that someone has finally woken up to her extraordinary talents.

D J Taylor is a novelist and biographer