Episode 17 Homes Under the Hammer

Hello and welcome to the programme.

Now, you might not fancy a big old project to renovate.

No, but you can always start small

and build up to something much grander if you wish.

Yes, and you might find that perfect property at your local auction.

The auction room can seem fast and furious.

It's all about preparation, research and holding your nerve.

So, let's see who did just that and got what they were looking for

on today's show.

Today, at a quaint cottage in the beautiful Malvern Hills

of Worcestershire, I've got a small issue with a tiny door.

It's starting to get a bit silly, isn't it?

In Stoke, a door in a two-bed house could be a real pain.

That's a health and safety issue right there.

Definitely get that changed.

And on the coast, down in Dover, Kent,

I'm spoiled for choice at this flat and commercial premises.

Now, which door do I go in first?

All of these properties have been sold at auction.

We'll find out who got them and what they paid for them

when they went under the hammer.

You bought it, well done.

The spa town of Malvern in Worcestershire

has given us many things -

spring water, Morgan three-wheel sports cars and Sir Edward Elgar.

He had strong links with Worcestershire

and lived in and around Malvern.

His Nimrod Variation is now synonymous with Remembrance Day.

I love quaint English towns like this.

You're just a stone's throw from the little centre of the town,

lots of nice pubs, views over the Vale of Evesham.

I mean, it is absolutely stunning.

Will the property I'm here to see live up to the expectations?

Well, hopefully.

It's a two-bedroom cottage, guide price 105 to 115,000 quid.

Sounds a bit quirky. Let's have a look.

This cottage, that backs on the end

of a short terrace, is certainly different.

For starters, the windows are laid out in a rather peculiar way.

So, you already know, don't you?

This is going to be slightly unusual inside and sure enough...

Oh, my goodness.

You don't have to go very far to see big problems with damp.

Look at that. Wow.

OK, so we're going to be on the lookout for that throughout the rest

of the property, but through the front door into this little sort of

area here. That, believe it or not, is the kitchen.

Very long and sort of thin, but what you kind of expect -

in an unusual position and very oddly shaped.

Oops!

Not too good if you're a slightly large, tall person.

Very, very low door height.

But in this room here.

You know, I think we're going to have to throw the definition

of what rooms are out of the window, cos I do not know what this room is.

It's a sort of middle room thing. So let's call it that, then.

Here, into the middle room thing, it's a pretty good size.

Round that way there's a downstairs loo, which is good news,

and then here, stairs down to the cellar, so that's good.

Let's continue our explore into...

Well, I don't know, let's call it middle room number two here.

Lots of unusual features again.

Oh, I don't like that.

Damp over there. It seems like it's coming in absolutely everywhere.

But it's just so quirky, isn't it? Don't you love it?

This little feature here, I don't know what that is.

It's a hole in the wall. It's completely barking mad.

It was mad when I was walking up and it's even dafter when you get in.

I love it!

# I don't care, I love it

# I don't care... #

The layout might not be for everyone, but I don't care.

And, yes, I do have eclectic taste.

# I love it. #

So, up a narrow and slightly quirky staircase, to the upstairs.

My goodness, what is in store up here?

I can't wait! A bedroom over that way.

More signs of damp towards the top there.

There's damp on every single wall, it seems.

It does seem like it's been freshly painted.

That always worries me. What else has been covered up?

But...one nice thing you have got,

lots of storage. And aren't these doors beautiful?

Absolutely lovely. Sort of a nice additional feature, which gives

even more character to the place.

Wow.

Tiny bathroom.

Look at the size of that bath.

I don't think there's enough head height to give you a shower, either.

Hmm. OK. Compromise.

Well, down here, into the second bedroom,

and it's starting to get a bit silly, isn't it?

I mean, look at this door and into this room!

I don't know, it's like a doll's house, isn't it?

It's amazing. It's amazing.

Whether you could live with it on a permanent basis, I'm not so sure.

It's easy to see from up here that someone has already started working

on the leaky roof, but I'm heading as low as you can possibly go.

Well, down into the cellar and it's actually a half-decent sized room

for a change. It looks like it's had something on the floor, like...

Oops. That's kind of fun.

Dead sticky now. That's the residue of the glue

used to glue the carpet or whatever down, but the moment you walk down

here, apart from the fact you go, "Ooh, it's nice and cool,"

is you're hit by the overwhelming smell of damp, so like the rest

of the property, not surprising, I guess,

the cellar is also in a bit of a state.

So, the house, really, first and foremost, needs to be, basically,

dehumidified, certainly down here, and then whatever it is,

wherever it is that that water, that rain, that damp,

whatever it is that's coming in,

you've got to sort that out first before you do anything else.

We've invited a local estate agent to view the property and give some

valuations on the different options, plus some background

on the area and its people.

Great Malvern's a lovely place to live.

Very popular place for, mainly, retirement people,

but also you've got the holiday let market, as well, here.

Which can be very lucrative, if there is enough demand.

How about valuations?

When the property has been fully refurbished,

I would value this property at around £150,000-£160,000.

The rental value on this particular property would be around £650

per calendar month to £700 per calendar month.

And the dream scenario, if you could generate year-round bookings?

On the holiday let market,

this property would fetch around £600 per week.

Well, they don't come much more quirky than this, do they?

And this is exactly the sort of property that somebody,

or probably quite a few people,

would have fallen absolutely in love with,

despite the fact it could be a potential money pit.

Who cares? Let's see who bought it, when it went under the hammer.

Lot 96.

Great Malvern.

60?

That must tempt somebody.

60,000, I'm bid at standing, at £60,000 only.

70, sir. Thank you.

70. 80, sir.

The lot came towards the end of the auction,

but there were still enough interested bidders

to take the price upwards.

We rejoin the bidding at £120,000.

120, yes, sir.

122, thank you.

124. Three if you like.

122,000, then.

For the first time. For the second time at £122,000.

Third and the very last time.

Fresh bidder again, 123.

124, sir.

125, sir, 125.

126.

Another one, sir. 126, six.

127.

No. As you wish. £126,000.

First, second and third time. I shall go on no longer.

And so going, going, gone.

And your number, sir, is...?

491, thank you.

Thank you, all.

The couple wielding paddle 491 were husband and wife

Jeff and Di.

They've refurbished properties and rented them out in the past.

Di trotted up the many steps approaching the house

to meet me and talk about their plans.

-Di, really good to meet you.

-Pleased to meet you.

So, you were one of those people who fell in love with this place, then?

Yeah, absolutely. It's so pretty, how could you not?

Well, indeed. Tell me about your relationship with this house, then.

How did you know about it?

Well, I've lived in Malvern for a long time.

My husband's been a builder in Malvern for 35 years.

-Wow.

-So we really know the area.

So when it came up for auction,

we only spotted it at the last moment, so we didn't even get

-a chance to have a look at it.

-No!

No, I know. Mad.

On the whole, we could have done a lot worse.

-Right.

-And, yeah, it's all right.

In terms of what you paid, were you happy with that or...?

We were. I don't think we'd have gone any higher.

If anybody had bid above us,

then I think that was the point we were going to stop.

-Right. Did you go above your budget or...?

-Slightly.

How slightly?

About £5,000 on what we agreed, but...

So, what was it about it? Cos you only saw it from the outside,

so let's just talk, what was it about the outside

that you thought, "Oh, yeah, we must have this?"

It's got bags of character, even from the outside.

And it's so quirky.

If you turn right out of here, you go straight up to the hills,

St Ann's Well and the Beacon, turn left out of here,

you're straight into the town, where you've got one of the best theatres

around, great dining, great shops, and we thought,

-maybe one day we might live in it, as well, so...

-Right.

So, one day you might live in it. So, what's the plan in the meantime?

If I get my way, it's going to be a holiday let.

It's a perfect holiday let.

If my husband gets his way, we'll sell it.

-But I'm not going to let that happen.

-Sell it?!

I know. I don't think he'll be able to.

What, you mean, he won't be ALLOWED to?

I'm hoping he'll love it so much, he won't be able to part with it.

Hmm, a risky strategy, that one.

I suppose it depends on how much he likes fixing

all the types of damp known to man.

So, you saw it from the outside, then.

Didn't see it inside until you'd bought it?

No. We had a quick look at the auction pack,

just a quick scan of it, before we bid.

-What, the legal pack?

-Yes.

A legal pack on something like this could be completely crazy!

-It could have all sorts of rights of ways and covenants...

-Yeah.

..and easements and goodness knows what.

-Yeah, that's right.

-But...

A quick scan, we couldn't see any thing major,

kept our fingers crossed and...

-Oh, no!

-I know.

And what about the rooms?

Down here, it's fine, but the kitchen's a bit kind of quirky.

-It is.

-Upstairs, though, the bathroom and the second bedroom...

I know. It's cute.

You're a lost cause, aren't you?

It's character,

but I don't want to take any of that away, cos it's lovely.

But the bathroom's not exactly practical, is it?

It's not, no. What we're going to do, hopefully,

we're going to move the boiler into the kitchen and try and put a shower

in where the boiler is at the moment cos everybody wants a shower.

You might want a nice, quirky, old building,

you still want your modern-day comforts.

Right. Especially if you're going to let it out to holiday-makers.

-Yeah, exactly, yeah.

-You mentioned your husband's a builder?

-Yes.

-So, is he going to do all the work, then?

-He is, yes.

Him and the contractors that he works with.

-Does he have a budget?

-We're looking, at the moment,

we think we can do it between 20 and 22.

What have you discovered, in terms of the damp and where

it's coming from, and how are you going to resolve it?

There's some water ingress in the main room, which is from the roof.

And is it you who started work on the roof already?

Yes. It was the first thing we wanted to take a look at,

cos we knew that would be the big... the big thing to deal with.

There's some rising damp we can deal with.

A lot of the damp in the cellar looks really scary,

but in actual fact, there was a leak from the downstairs loo

and that's all it is.

So, once that's dried out,

we'll replace the floor and that should pretty much deal with it.

Right. So do you have any idea of timescales for sorting it?

-We're hoping three months.

-Listen, I'm really delighted for you.

Lovely to meet you. Good luck with it.

-Can't wait to see how it turns out.

-Thank you very much.

Well, there you go, as you might have predicted,

Di and her husband completely falling in love with this place.

Well, I say her husband, will he really be able to let go of this

once it's sorted out? That's the big question.

In the meantime, lots of work to be done,

but they don't seem too daunted, and, yeah...

I can't wait to see how it turns out.

You can find out later in the show.

Chell in Staffordshire is a bustling suburb of Stoke-on-Trent.

It has a good mix of housing stock and lots of green space,

with Tunstall Park nearby.

Then, there is the structure

built in 1907 by the Adams family.

But, no, it isn't creepy and kooky.

It's a quite nice, stylish clock tower.

Now, the property I'm here to see is an end-of-terrace post-war house.

Now, it does have a modern feel to it,

but it also has some of the design features from the traditional

terraced houses within the area.

And here it is. It's got two bedrooms

and it has a guide price of £49,000, plus an added bonus -

a bit of off-street parking.

OK. We have got some very colourful carpet to start off with.

Stairs going up to your bedrooms, just there.

Into the lounge and these doors, or this door, should I say,

will definitely have to change.

That's a health and safety issue right there.

Definitely get that changed. Nice big window, lots of light coming in.

Double glazed window, as well, which is great.

Central heating. I'm listing lots of stuff here.

So, very good start.

Good-sized room, as well.

You've got an old-fashioned, sort of, '70s fireplace.

Bit of storage, some shelving space in here.

Looks like there may be a bit of damp or maybe a bit of mould,

due to lack of ventilation.

It might have been closed and shut down for some time this house, so...

And, there seems to be quite a large

crack at the top there, as well, so...

I may come back to that, but that's quite alarming.

OK, through the back, we've got the kitchen.

Out here, we've got a downstairs toilet, which is good news,

and the back door, going out to the back garden.

Kitchen's a good size. It is dated. It is a little bit old-fashioned.

Wouldn't take much to take it out,

put a brand-new kitchen suite in here, but you do get a feeling

that it's been looked after,

it's been given a lot of TLC over the years.

The only issues I've seen so far is that little bit of damp and mould

and that crack, but that is it.

Lick of paint, new carpets, brand-new kitchen,

you'd be sorted down here.

Out back, the garden has been well landscaped,

but it's still a bit overgrown.

With 'gnome' messing around,

it's time to fly upstairs.

OK, coming up the stairs, you've got what looks like wood,

but it's not, it's actually wallpaper.

Bathroom here, at the top of the stairs.

No bath at all, but a really nice, large shower.

And I see there's a water tank, as well.

If you wanted to try and reconfigure that, put a bath in,

you could quite easily try and get a combi in there.

Two bedrooms. You've got a yellow bedroom there,

looking out onto the back of the house, which is a good size.

In here, we have got the front bedroom

and I've seen, for the first time upstairs, a wall without wood chip.

Get a shot of that, whatever you do.

Good-size room, anyway.

Purple carpet, you want to get rid of that.

Period fireplace, over there.

Only a small one, but quite sweet.

You could actually tidy that up, as well.

I'm liking what I'm seeing.

And there's not really anything here that's making me think,

"I'm a bit frightened."

Well, I take that back.

Everyone is scared of the prospect of chipping away at wood chip

and there might be something else to be worried about,

on closer inspection.

One thing I have noticed, there does seem to be

quite a few cracks in this ceiling.

As you can see, all the way along and all the way through to

the centre here, and there seems to be...

Especially here.

There's even a little bit of movement there, as well.

It might be nothing. It might just be a bow in the plasterwork.

I do know that, back in the day,

there was a lot of mining in these parts.

It might have something to do with it, it might not.

But it's always good to get it checked out

and definitely read the legal pack.

I mention mining, as the cause could be subsidence or the house moving.

If it's historic, nothing to worry about.

But if the house is slipping into an old mine shaft,

then picture the cracks getting worse and then some.

An agent from the auction house that sold the property

can give us a second opinion.

It is an old property.

There is some signs of cracking, that can clearly be seen.

But, really, a buyer would be prudent to investigate that

prior to auction and possibly look

to get an opinion from a professional surveyor.

There is some signs of damp downstairs and, potentially,

there would be a timber and damp investigation also required.

Wise words. Worth repeating.

What else does this house need?

The property itself really just requires

some modernisation and improvement.

Depending on the specification,

I would expect most people

would look to spend in the region of £15,000 on a full refurbishment.

So, get it at the 49 grand guide price and you could be looking at

a £64,000 total spend.

Would it be worth it for sale or rental?

After refurbishments,

I would look to market this property in the region of £95,000 or,

alternatively, rental income in the region of £450 per calendar month.

This property could be a bit of a...

coo.

There isn't an awful lot that needs to be done to this house.

This should be a really nice, or could be, a really nice family home.

But who was lucky enough to get it when it went under the hammer?

Lot number two.

40, to start?

Got to... 40 bid, seated, thank you.

£40,000. 45, can I see now?

At £40,000.

Who with the 45? 45 bid now.

At 45. 50, sir.

Sluggish to start, so the auctioneer dropped the guide price,

but things were soon looking up and we rejoin the bidding at £53,000.

53. 54. 55.

56. 57.

58? 58.

59. 60.

60.

Shaking his head. 60. 61, lady now.

62, anywhere else?

If not, £61,000 once,

£61,000 twice, third and final...

62.

63, madam? 63.

64, sir. No? Still with you, madam.

At 63,000, all done now.

63 once, twice, third and last time.

63,000.

You've bought it, madam, well done.

The winning bid of 63 grand was by Alison.

For her and her partner Steve,

this marks the first venture into property development,

so what did they have planned for the new house?

-Alison, nice to meet you.

-And you too.

-Congratulations.

-Thank you.

What attracted you to it in the first place?

Well, it was a nice, sunny day, I just came past,

looked through the window and thought, "That's the one for me."

-Hold it, hold it a minute. You looked through the window?

-Yep.

Did you view it before you bought it?

No, just came past, looked through the window and thought, right spot,

looked sunny, looked nice, looked happy, so that was it.

So lucky!

-You should always view your property, shouldn't you?

-You should.

-Did you read the legal pack?

-I did, yes.

-I did do.

-Well done.

-That's one out of two, I'll accept that.

-Yeah.

I've been in lots of houses now.

This is one of the houses, probably the best house I've seen.

-It's in great shape.

-It is.

From the outside it looks really pretty, quite easy to live in.

Inside, obviously, quite outdated.

And so I thought for a first step into the market,

this is the best type of house to get.

First place to dip your toe into.

That's it.

# They call you lady luck

# But there is room for doubt... #

Alison is a lucky lady, in my opinion.

Even if you do read the legal pack,

you should always view the property before parting with your cash.

Thankfully, the pair have landed on their feet here.

So what are you going to do, from top to bottom?

Upstairs, probably re-plaster the bedrooms.

Totally refurbish the bathroom.

Come down the stairs, remove all that awful wallpaper on the stairs.

-Not your taste?

-No!

Downstairs, probably replace all the kitchen, downstairs toilet,

take out the fireplace in here and generally redecorate.

-Structurally, it seems pretty sound.

-Pretty sound.

I have seen a little bit of damp,

maybe mould in the downstairs cupboard and a few cracks, as well.

-Yes.

-Any concerns?

No, I don't think it's anything to be too concerned about.

I think the house has been empty for a few months

so it's only to be expected, really.

My other half is quite experienced with houses like this.

He's been a gas engineer.

He trains gas engineers now,

so he's done a bit of everything, really.

So he was OK with it all, so I trust his judgment.

What kind of budget have you given yourself?

About 8,000, maybe a little bit more.

Not quite sure, really, just see how it goes.

And how long are you hoping all the work's going to take you to do?

-Probably about 12 weeks.

-OK.

-Maximum.

-That's not too bad, is it?

-No, we'll give ourselves a bit of space.

-We're both still working so...

-OK.

-It's just got to be fitted in.

Alison works in a bank as an anti-money-laundering officer.

No surprises, then, that she is well-placed to project manage

and keep those numbers tight,

but she does plan to get her hands dirty, as well.

How are you going to squeeze it in, all this work?

Well, I only work three days a week, so outside of that,

I'll be here every day scraping the wallpaper off,

taking tiles off, and he'll be here at the weekends.

What enticed you into the property world?

Mainly because I'm getting to an age where I've got to think about

-retirement one day.

-No, no, no.

-I am, yes.

-Cut, I'm not accepting that.

Yeah. So I just thought, it's something there

to boost my pension for when I do eventually retire.

So is this the first of many, then?

-It could be.

-Is that what you're hoping?

It depends on how it goes.

If we make a profit, then, yes.

-For your first one, I think you fell on your feet.

-Hope so.

-I wish you all the best, Alison.

-Thank you. Yep.

-And the same to Steve, as well.

-Thank you. I'll pass it on.

-Good luck, good luck.

-Thank you.

Despite only looking through the window,

Alison and Steve have got themselves a really nice house.

They did read the legal pack, though, so no nasty surprises.

As a first project goes, this should be pretty straightforward.

You can find out how they get on later in the programme.

Still to come, at this two-bed maisonette and ground-floor shop

in Dover, Kent, I've got something pretty exciting to show you.

Have a look at this.

And have Alison and Steve found a balance

at their two-bed house in Stoke?

It's just keeping a level head and not going overboard on things.

Time now to get back to the glorious Malvern Hills in Worcestershire and

this curious cottage that really took my fancy,

even though it was far from perfect.

The moment you walk down here,

you're hit by this overwhelming smell of damp.

'There was a small problem upstairs.'

Tiny bathroom. Look at the size of that bath.

'And back downstairs...' Don't like that.

Damp over there and it seems like

it's coming in absolutely everywhere,

but it's just so quirky, isn't it?

Don't you love it? This little feature here.

Don't know what that is, there's a hole in the wall.

It's completely barking mad.

It was mad when I was walking up and it's even dafter when you get in.

I love it.

The cottage was bought, damp and all, for £126,000 by Di and Jeff,

who is, luckily, a builder.

But there were some differences of opinion.

If I get my way, it's going to be a holiday let.

It's a perfect holiday let.

If my husband gets his way, we'll sell it.

But I'm not going to let that happen.

-Sell it?!

-I know.

I don't think he'll be able to.

What, you mean, he won't be allowed to?

I'm hoping he'll love it so much, he won't be able to part with it.

I know who I'd put my money on!

Ideally, long term, Di would them to live here

and they budgeted £20,000-£22,000 to restore and rejuvenate it.

So do you have any idea of timescales for sorting it?

We're hoping three months.

Well, eight months later and they've been busy re-rendering the outside,

repainting the outside and fitting a new door with a new shower fitted,

just as planned.

# I'm coming home, I'm coming home

# Cos this life that I've been living ain't my own... #

The cellar eventually dried out enough to be re-floored

and the kitchen was spruced up with new units added.

# I'm coming home

# Oh, yeah, yeah, yeah

# I'm coming home

# Oh, yeah, yeah, yeah. #

The damp in the downstairs rooms dried out after the roof repair

and the traditional boarding and neutral colour schemes

makes all the rooms much fresher.

The damp in the back bedroom is gone.

In fact, all the damp is gone.

Result.

The bathroom also has a new sink and fittings.

If you think the ceiling in the front bedroom is a bit higher,

that's because it is.

In redoing the roof and re-forming the ceiling,

a bit more height and roof insulation were achievable.

So, how did the couple fare with the heavy workload?

It was a bit of a rollercoaster of emotions.

We'd find one thing that was great and we didn't have to spend money on

and then we'd find something else that cost a fortune.

So, it was exciting and stressful, but there was nothing major.

I think, we were very lucky in the end

because we hadn't seen the property before we bought it.

I think we came off lightly, to be fair.

Well, you can say that again.

What was it like filling skips, with all those stairs and no path?

The access to the property can be a bit difficult

because it's on the side of a hill so, yeah, there were problems.

Fortunately, our neighbours have been absolutely wonderful

and we couldn't have done it without them.

They've been so patient when we've had scaffolding at the side

of the building or needing to park everywhere.

They've just been so accommodating.

I don't want to sell the house cos I want to keep the neighbours!

Well, we all appreciate good neighbours.

So, what did Di get stuck into on the project?

I made quite a few of the decisions on how we were going to do things

and got involved in a few arguments about it, too.

But, yes, I think I kept an eye on the money

and would have spent more if Jeff hadn't stopped me.

So did Jeff manage to keep you to that £20-£22,000 budget?

We ended up spending between 28 and 30,000, we think.

But we had to get the roof done

which we didn't know how much that was really going to cost

until they came and did it.

And then we had to take the ceilings down upstairs and redo the ceilings,

and that was an additional cost we hadn't anticipated.

We called in two local estate agents to give us valuations and opinions

on the restoration job.

I think they've done a really good job.

They've kept it nice and neutral in terms of decoration but they've kept

an awful lot of character, and that's what people are looking for

when they're moving to locations like this.

The buyers have done an excellent job in renovating this cottage

combining contemporary living

yet still retaining its original charm and character.

So that's thumbs up from the agents.

But Di and Jeff have spent a lot on this cottage.

The total investment is now around £156,000.

Would they get their money back if they sold it?

We would probably put it on the market somewhere around the £220,000

mark and look to achieve somewhere between £200,000

and the asking price.

If this cottage went on to the open market,

I think it would sell for a figure of around £200,000.

That could mean a potential profit of up to £64,000

minus taxes and fees,

if they were to crack that top figure.

I feel vindicated because we knew it was a difficult one to price,

but we know the area so we felt confident

we were doing the right thing and,

yeah, we're very happy with those prices.

The rental estimates were between 700 and £750 per calendar month.

The top figure would give the couple a yield just short of 6%.

We've done some research and we felt that that would, hopefully, be where

we'd pitch it for rental, so very happy with that, as well.

The agents valued the holiday let at an average of £600 per week

over the year. If the cottage were let for the whole year,

ambitious as that sounds, it would produce a yield of 20%.

I think that would be what we'd like to achieve so, yeah,

very happy all-round with all of those.

And who wouldn't be?

So have there been any decisions yet on the future use of the property?

We still don't know what we want to do.

We've had a few offers even though we haven't marketed it.

A lot of interest, but we've also fallen in love with it,

which we knew we were going to,

so we still don't know whether to rent it as a holiday let

or sell it. We've got to make a decision.

Dover in Kent is famous for one thing.

You guessed it.

The local port of Dover, which is the nearest port to France,

and the world's busiest by passenger numbers.

No, that's not what it's most famous for.

That would be Dover Castle built by Henry II in 1189.

Still not it? Is it more famous for the beach?

Its range of architecture, perhaps?

Well, I can't think of anything else it's famous for.

# There'll be bluebirds over

# The white cliffs of Dover... #

Ah, yes, that would be it, then.

So what's up for auction in this sunny seaside town?

Well, it's a slightly unusual listing.

It's a two-bed maisonette on the upper floor,

but this lot comes with its very own shop, too.

So, for a guide price of £90-£95,000,

you get the flat up there and the lease for what appears to be a

successful little business down here.

Now, which door do I go in first?

Yep, to the first flat, which you gain the freehold of,

should you buy it.

It's worth remembering that flats above shops are often difficult

to mortgage, so rather than getting two properties,

you might just get a financial headache.

So let's have a look around and see what you do get.

So this is the living accommodation above the shop.

Now, it's a maisonette, which means it's split level,

it's on two floors.

You've got your sleeping accommodation upstairs.

The kitchen area here, the high street just out there.

And, actually, because of this double glazing, it's not too noisy.

But it could do with a bit of a refurb.

Possibly a new kitchen, a lick of paint, some new lino,

not sure about these textured walls,

so it does need a bit of a spruce, some new carpets, perhaps.

But what you do have are some really nice views of Dover.

Have a look at this.

Yes, spectacular views, I'm sure you'll agree.

But mind your step, as this roof is in poor condition

and unlikely to pass current safety regulations.

The condition upstairs is much the same as the downstairs.

A new bathroom suite and some modern decor wouldn't go amiss

in the flat's two bedrooms.

The other thing you are taking on with this lot

is the lease of a gaming shop downstairs,

with good outdoor space and good facilities

and proportions in the shop itself.

It's currently bringing in around £3,500 in rent, but the commercial

sector isn't exactly healthy right now,

so taking it on could be a bit of a gamble.

So when it comes to commercial property, well,

that is a whole different affair,

with an average of 16 shops closing a day.

The number of retail premises that remained empty in 2014

almost tripled to 987,

so having an established, successful trader already in place

and wanting to stay here, well, for commercial property,

that could make this only part-vacant lot

something to really celebrate.

MUSIC: Board Game by Collapsed Lung

Because of the shop's income,

it opens up plenty of possibilities with the flat.

We invited a local property expert along to ask him what he would do

with the property.

For long-term investment,

I would keep both the properties let and benefit from the dual income.

Get the flat renovated and a tenant in it.

Before buying a property like this

with an existing tenant in a place,

it's always worth making enquiries

on the status of the tenancy,

the rent history and that there's been no breaches of the agreement.

The agent thinks that you can spend a maximum of 10 grand here,

so your total outlay including the top guide price would be £105,000.

What kind of return could we get for that?

With the building fully let,

the income potential here is something of the order of 800,

£850 per calendar month.

At £850 per calendar month, that could be a 10% yield,

or would you be better off selling the flat and

shop lease?

Presuming it's fully let,

then the value is going to be about £100,000.

Based on the figures so far,

there's not much, if any, room for profit.

You're going to need all your pieces in the right place

to make this one work.

This certainly isn't a simple project for a novice developer,

with the residential flat upstairs

and this commercial property down here,

plus, you've got an ongoing lease.

Well, there's certainly a lot to get your head around here

and if you want to make a profit on this, well,

you'll really need to know what you're doing.

So, who was up for the challenge and wanted to play with this property

when it went under the hammer?

Right, lot 16.

Good little lot here.

Start wherever you like.

£90,000, perhaps.

So you've got the shop and a vacant maisonette above,

and I'm looking for £90,000.

Give me 80, then.

It's in Dover. £80,000.

£80,000, I've got.

£80,000.

And five now, can I say?

85, do I see?

85 bid, I have.

£90,000 is against you.

At £90,000 bid.

95 now, if you like.

95 do, I see?

At 95, do I see?

At £90,000, second row back.

95 I'm looking for.

It's here to be sold at £90,000.

For the first time, then, at £90,000.

In the second row back, for the second time at £90,000,

third and final time at £90,000, are we all done and happy?

All done? Yours at 90,000.

Well, sir, you certainly beat everyone on that, didn't you?

A bid at the low end of the guide price of £90,000 was enough for the

business partnership of Mike and Andrea to secure the properties.

Andrea is a personal trainer, while Mike is semi-retired,

running an estate agency in London.

This was their first auction purchase.

So what was their plan?

Mike and Andrea, congratulations, lovely to meet you both.

-And yourself.

-Nice to meet you.

-So, I want to know, what was the interest?

Why did you want to buy this?

It's a nice, spacious flat, reasonably clean,

doesn't require too much work.

Well, it requires all the fun work, which is putting in new kitchens,

new bathrooms where you can.

Me and Andrea are going to help to get things like that done,

and very much so. The shop came with it, but the shop pays some rent

so there is some sort of income coming in

and we just felt that as a package, if it went for the right price,

it was worth paying.

So you've obviously got the shop with the tenant in situ now.

So are you happy to keep the shop as it is downstairs

and keep the tenant?

We're not sure. We'll...

We know that we want to do up the flat and either sell it or let it.

More likely sell it, if we can get the right price.

Once we've done that,

we will then look at whether or not

we should sell on the shop down below to somebody

who is more interested in commercial or whether to keep it as

a small investment.

So the dice can keep rolling in the shop for now as Mike and Andrea want

to make their money on the flat, be that through selling or renting.

What are you going to do to try and turn this flat around?

Because it is incredibly dated.

Well, obviously, in the first place,

we were thinking to change the kitchen,

change the bathrooms,

but in the end, we will do minimum work.

Originally, we were going to do the whole lot,

and we have a budget of about 14,000, something like that,

in order to do everything and lovely new kitchens.

But we've spoken to a couple of local agents since we bought it and

they've more or less said, yes, that would add maybe 15,000 to the value.

But you're spending 12, 14, 15,000 in order to do it.

We're looking at almost three options.

One is luxe, do the whole lot, make it a beautiful flat,

and we could do that within the budget that we planned

from the very beginning, and that was where we were starting.

The second is to do a reasonable amount,

to make it look a lot cleaner and nicer.

The third one, though, which was the advice of one or the two agents that

we spoke to, was, in fact, I wouldn't bother to do anything.

They actually felt you could let this as it is.

They actually thought you could sell this as it is

for this market and this area.

Now, I was surprised, but I've got to be tempted to give them a chance

to do that and see if they can do what they've said and if they do

achieve what they said, that would be wonderful news

and if they don't, we do our work.

So is it almost experimental at this stage, isn't it?

You don't quite know what to do.

Well, it's not experimental.

It's incremental.

In other words, if we start off with an agent who comes in and says

we can sell it now for this good price...

-It's gone.

-..give them a chance.

-Yes.

If after six weeks...

It's going to be a bit boring for us, though, cos when we come back

we're not going to be seeing anything spectacular.

-I'm sorry about that.

-I want to know about that!

I know, but equally you will be seeing something of a different

way that you can do it sometimes.

So whatever plan they may choose,

Mike and Andrea plan to fix the flat roof terrace and estimate that it

will cost £2,000, but they have a maximum budget of 15 grand

should they go for the luxe option

and hoping any work won't take any longer than six weeks.

It's a prudent business partnership,

born out of - what's the phrase? -

a conscience uncoupling.

Well, we'd reached the end of marriage, I suppose,

at the very best way of putting it, but still good friends.

We had to sell the property in order to split the money up,

as you have to do at the end of a marriage,

and we did that together and we did up a property in London,

which was the one that we had as a home, and we enjoyed doing it

and we felt it went well.

We felt that the product that we sold at the end

was really very nice.

Why not see if we can do that again as a business?

-So you're working together as a business now?

-Yes.

-Yes.

And obviously you're both doing very well and enjoying it.

Well, we'll see...what's going to happen after this.

-This is your first investment together unmarried?

-Yes.

-Yes.

And you've both agreed so far

that this is the right investment for you?

We both agreed it looked the right investment.

We'll know if it was the right investment in a few months' time.

-When we come back and see, we'll find out.

-That's right.

-That's right.

Guys, this is such an interesting lot. What will you do here?

It'll be good to see when we come back. Thank you so much.

Great meeting you, Mike. Andrea, thank you.

-Nice to meet you.

-Good luck.

-Nice to meet you, too.

Well, this unusual lot has been bought by an unusual couple.

But Mike and Andrea have made a way to make their separation work

and they still enjoy working together,

so I suspect they will make this property work, too,

but which option will they go with?

Join me later in the programme and you can find out.

Well, that's one of our buyers sorted.

We still have two more to come.

Yes, stick with us to see if everything went to plan.

Yeah, and if it didn't, did they still make a profit?

Earlier in the show, I was in Chell,

a Staffordshire suburb of Stoke-on-Trent,

and this end-terrace two-bed was guided at £49,000 plus.

Dated decor betrayed the house's age,

but it had clearly been loved, with only a few problems.

The only issues I've seen so far is that little bit of damp and mould

and that crack, but that is it.

Lick of paint, new carpets, brand-new kitchen,

you'd be sorted down here.

# You wear it well

# Little old-fashioned, but that's all right. #

Eager to get this house a new lease of life was Alison,

who purchased the house for £63,000 with her partner Steve.

Alison had only seen the property through the window

before she made her bid for it, but I reckon she was lucky.

This house wasn't money down the drain,

which is just as well, as this is part of Alison's pension plan.

I'm getting to an age where I've got to think about retirement one day.

-No, no, no.

-I am, yes.

-Cut, I'm not accepting that!

Yep, so I just thought it's something there to boost my pension.

Is this the first of many, then?

-It could be.

-Is that what you're hoping?

It depends on how it goes.

Time to find out if it has been a success, then.

Six months later, we are back.

The outside has had some work,

with the driveway being re-laid and some security lights fitted.

What about the inside?

Well, the living room is more neutral

and the dated fireplace has gone.

I seem to recall Alison was not keen on the wooded wallpaper.

Upstairs, there is a bigger bathroom,

thanks to the removal of the water tank

and the bedrooms have been replastered,

plus no more dated carpet.

Thankfully, there is new flooring throughout.

The downstairs bathroom's '50s feel has been flushed away.

And the highlight for me,

a very bold kitchen, where the colour schemes

would make you green with envy.

Steve is a gas engineer, so I'm sure he's made this kitchen

greener in more ways than one.

So, I've took out the old inefficient boiler that was in the corner,

put in a more modern combi boiler in the downstairs loo.

We've refitted the kitchen totally with new cupboards,

allowed space for a washing machine by the sink and levelled the floor

up, which was totally uneven.

Upgrading the boiler and replacing the heating adds value,

but it also allowed for that bigger bathroom.

We took out the old central heating system that was linked

and they had it standing there, and all the tank work.

So we've revamped that by moving the toilet slightly, tiling it,

fitting a bath with a shower over it,

making the room generally bigger by relocating the door.

Alison and Steve certainly haven't stayed superficial

with this renovation,

with a major rewire and plastering throughout.

That has fixed the problems with the damp

and the cracks which have turned out to be nothing serious.

All seriously skilled trades, though, so who has done the work?

Steve did all the gas and the plumbing work.

I did a lot of taking off the plaster, repainting,

but we did get somebody in qualified to do the electrics

and we did get some help with the labour on re-laying the drive,

but apart from that, we did most of the work ourselves.

How has hiring outside contractors impacted on the eight grand budget?

We have spent closer to 10,000,

but we are quite pleased about that

because everybody sets themselves a budget, but in reality,

you always set it lower than you think.

And it's well within our budget to have done that.

I know all too well, Alison.

They always cost more than you think

and it often takes longer than expected.

Case in point here, with the work taking four months,

rather than the planned three.

Have they learned any other lessons from their first project together?

I think the most important thing to learn is to cost each of the jobs

before you actually do them

and to control what you'd like to do because sometimes what you'd like

to do to a property isn't necessarily going to

make any money, but apart from that,

it's just keeping a level head and not going overboard on things.

Spoken like a seasoned professional, Alison.

The couple are planning to sell their first development,

and that means they'll need the thoughts and valuations

of two local estate agents.

Let's start with the agent that saw it before the renovation.

This is my second visit to the property.

It's been done to a reasonable standard, it's neutral, clean,

fresh all the way through and it's what

you really would expect for this type of property.

I think the selling point of this property is that it's

in a good area, it's in a good commutable location

and it's been done to a very good standard

and it would suit first-time buyers.

Alison and Steve spent a total of £73,000 here.

So can they make a profit for their pension on the sales market?

I would expect this property to achieve somewhere in the region

of £85-£90,000.

I would place the property on the market in the region of £90,000.

The sales figures, we're really quite pleased with.

That's probably a bit more than what we were expecting,

so that's quite nice, isn't it?

Yeah. I'm happy with that cos we had hoped for at least 85,

but if we can squeeze a bit more out of it,

everybody is happy with a bit more pound in the pocket, aren't they?

More pounds in your pocket, indeed, Steve.

At a resale value of £90,000,

you'll need some pretty big pockets, too,

as that gives them a £17,000 profit before usual taxes and expenses.

With this having gone well, are they going to tackle another?

Turn a quick sale on it, get into another property and move forward.

Probably a larger scale if we could but, you know,

you got to get some money in to make that happen.

Ambitious, I like it. And good luck to you both.

We're docking in Dover in Kent, where earlier in the show,

I saw an unusual lot guided at 90 to 95,000.

Half of the lot was a maisonette flat

that needed modernising and work on its roof terrace area.

The other half was the lease for the downstairs shop

that was already tenanted,

so a property of two halves, and it was bought by Andrea and Mike

for bang-on the lower end of the guide price of £90,000.

# I know what you want, you want the better of two halves. #

And talking of halves, these two had been each other's better halves,

having once been married.

However, they actually discovered a joint talent and love for property

development while settling their divorce.

Having bought this flat to do up and sell, after taking advice,

they had to decide on a game plan.

We're looking at almost three options.

One is luxe, do the whole lot, make it a beautiful flat.

The second is to do a reasonable amount to make it look a lot cleaner

and nicer. The third one, though,

which was the advice of one or two of the agents that we spoke to was,

in fact, I wouldn't bother to do anything.

They actually felt you could let this as it is.

They actually thought you could sell this as it is for this market

and this area. If after six weeks...

It's going to be a bit boring for us, though, cos when we come back,

-we're not going to be seeing anything spectacular.

-I'm sorry about that.

-I want to know about that.

-I know, but, equally,

you will be seeing something of a different way that

you can do it sometimes.

So, would we see a very different way of doing things?

Nine months on, way over their six- to eight-week timescale,

we're back, and I would like to see option number one, the full refurb.

Don't break my heart, Mike and Andrea.

# I should have known from the start... #

I had a feeling at the beginning that it would be minimal work,

and the couple's only major undertaking had been to repair

the roof terrace.

Worse still, the games shop downstairs has gone.

# Quit playing games with my heart. #

With Andrea busy with work, it falls to Mike to explain what's happened.

All we've really done is to look at the balcony outside, which is a nice

large open area, we've put some balustrades in around there,

we've improved the surface there

so it doesn't leak into the shop down below.

Beyond that, we've made sure that the boiler's safe,

made sure the electrics are safe.

But it's been small things like that.

Unfortunately, as far as the shop's concerned, the tenant had to leave.

She was a lovely tenant to have.

We were really sorry to lose her,

but for personal reasons and to her business,

she had to give notice, so the shop is, at the moment, empty.

So why did they opt to do only the minimum work?

Well, we really wanted to renovate the maisonette at the beginning

partly because we thought it would improve the value

and partly cos, again, it would be part of us doing the part of the job

we love which is actually refurbishing and getting it right.

But the advice we got from almost every local agent was it would not

increase the value of the flat by the amount of money we spent.

And there is no point in doing extra work in order to make less money.

I agree, Mike. I have a motto.

Don't just speculate to accumulate,

speculate where appropriate.

It must be true because it rhymes and everything, doesn't it?

No. OK, their budget was £15,000 for the full works and two grand for

just the roof, so what did they spend in the end?

Now, THAT rhymes.

Our total refurbishment budget, if we can call it refurbishment,

has come in at about 2,900, £3,000.

But why has it taken nine months to get to this point?

Well, the works were done within the six to eight weeks

that we were talking about, then we spoke to the local agents.

Basically, we've been reducing the price

until we got back down to a more realistic price, which is about now.

So, six to eight weeks to do the work and seven months on the market,

but I'm pleased to say there is a happy end to the story.

And we've actually ended up finding

a buyer for both the shop and the flat together for 119,000.

And we're fairly happy with that.

£119,000 would give Mike and Andrea

a £26,000 pre-tax profit against their total £93,000 spend.

Time to ask two local estate agents if there was more they could

have done to increase the price.

My first impressions are it's very spacious,

it's got a lot of potential.

If I were putting the property on the market,

I would suggest to neutralise upstairs

because I think that is beneficial to any prospective purchaser.

Selling the property as a whole is the best solution.

For example, if we did

sell the flat on its own,

I believe the mortgage company might have problems with lending,

and that's due to the nature of the unknown factor

of what that shop could be.

Top tips, but is £119,000 the right price?

Is there room for more profit?

Is there more profit possible against that £93,000 spent?

I believe the figure that we could sell the whole property on for

would be around about £125,000.

If this whole property was put on the open market,

I would be expecting to achieve

between 125,000 and £130,000.

That sounds reasonably realistic.

We had advice to put it on for more.

We had an offer for the maisonette on its own for 80,000.

But we've decided to proceed with an offer

for the whole property instead.

£130,000 would be a 37 grand profit before the usual taxes and expenses.

Maybe they could achieve that by following the estate agent tips.

But Mike and Andrea are keen to complete the deal

and move on to another property

they can really get their teeth into.

Unfortunately, Andrea can't be here today because she's working, but if

she was here, I think she'd say that she is happy with the way

that things have gone generally, but we hope that the next one we buy,

she can put more of her own stamp on it

in terms of the renovation work, etc.

Well, no matter how simple things seem at the outset,

there can be problems when you get into property.

Ah, yes, you've got to be prepared for the things

you didn't see coming.

Yes, so for more tales of the unexpected,

join us here again for more Homes Under The Hammer.

-Goodbye.

-Goodbye.

-Goodbye.