Episode 46 Homes Under the Hammer

Hello, and welcome to the show.

Ultimately, a property is worth what somebody is willing to pay for it.

But, in a vibrant market,

that can be a little bit more sometimes than you first expected.

Yeah, that is why it's so important to get your budget, to stick to it -

otherwise you can just end up overpaying.

Mm-hm. And oh, boy, is that most definitely true

when it comes to buying your home under the hammer.

Auction rooms are busy old places.

I've been to plenty where it's just standing room only.

Yes, it's quite a theatrical experience

to see bidders battling it out to win their lot.

Yeah. So who was successful on today's show, and what did they buy?

Let's find out.

There are some good basics with this three-bed semi in Stafford.

Nice big window at the front and a door going out to the back garden.

Lucy's step count is increasing

at this two-bed mid-terrace in Gillingham, Kent.

But again, it's two big steps down,

just like it was coming through the front door.

This three-bed semi in Sheffield, South Yorkshire,

has a dangerous garden feature.

Wish me luck.

HE GRUNTS

Whoa! ARGH...!

All of these properties have been sold at auction,

and we'll find out who bought them and what they paid

when they went under the hammer.

-GAVEL BANGS

-Sold on the phone.

MUSIC: These Boots Are Made For Walkin' by Nancy Sinatra

Time to head to the West Midlands now and the town of Stafford.

As far back as 1476,

Stafford has been well known for its shoe manufacturing.

But, with that in the past,

today it offers great potential for investment,

thanks to great rail links into London.

# These boots are made for walkin'

# And that's just what they'll do

# One of these days, these boots are gonna walk all over you... #

Well, unfortunately, my boots were not made in Stafford,

but they were definitely made for walking.

And it's a good job, too, cos here in Moss Pit,

where we find our property,

it's about a half-an-hour walk to the town centre.

This is a three-bedroom semidetached house

with a guide price of £105,000.

I'm going to have a look around, see what it's got to offer.

It looks a big house from the outside.

A little shabby, I'll admit, but I have high hopes.

OK, nice, decent-sized hallway.

There is a porch just there,

and this is the second door getting into the property.

Solid door, good for security.

You've got your stairs going up to your bedrooms

and, across this hallway, you've got two decent-sized reception rooms

connected with double doors.

Nice big window at the front and a door going out to the back garden.

To my left, over the hallway into a really big, decent-sized kitchen,

you would have to start again in here, put something new in here,

freshen it up a bit. It does look a little bit tired.

And in here, we have got a wet room,

and it looks like it's been converted for assisted living.

Er, maybe you could find a better use for that.

If the kitchen is here, I'm thinking to myself maybe a utility room.

Maybe? And another door.

Now, I'm pretty sure that's not the door I came in.

Er, maybe that was a coal store or something,

but there's doors everywhere. Let's check out upstairs.

This place is tired and dated, but it has great proportions.

It's crying out to be modernised and brought into the 21st century.

You've got the foundations here for a lovely family home.

OK, upstairs, we have got three bedrooms and a bathroom as well.

Now, that would need a new bathroom suite in here.

It's a good size, though,

but you also seem to have this void space as well,

you can always make it that little bit bigger,

maybe increase the space of that family bathroom.

Three bedrooms - all seem to be of a decent size -

and this seems to be the master bedroom.

Now, in terms of profit,

this house has got a guide price

which I think is kind of borderline.

It's up from £105,000.

Now, I know a house in the area recently sold for 123,000.

Now, I think you'd have to spend

maybe £8,000, £10,000 on this house, just to get it right.

And that takes your costs to maybe £113,000, £115,000.

That's if you got it at the guide price.

Now, I think if you're taking on a project like this,

especially this one, you would have to watch your budget.

The downside to being spacious is that it impacts on the budget -

bigger rooms equal more materials.

There's a fairly big kitchen and possibly utility room to fit out.

So be wary with your budget running away with you,

especially when it comes to planting a garden of this size.

But once tidied up,

it would be ideal for a family with young children.

So, out at the front of the house,

I just wanted to look at the off-street parking situation.

The kerb's already been dropped and you've got space here for one car.

If you're lucky enough to have more than one car,

you've got all of this space.

You could quite easily transform this into a bigger driveway.

Two cars or even maybe three.

What I would suggest is speaking to your local council, get some advice,

get some permission, find out what you can and can't do.

But one thing it would do, it would increase this house's appeal.

That's for sure.

Do remember that you have to comply with regulations

to help minimise potential flooding, intrusiveness and visual impact.

As I said, talk to your council first.

What does a local agent think of this house,

that was guided at £105,000?

I believe the cost of this refurbishment

would be in the region of £10,000

to make this into a lovely family home.

In addition to this, I believe that, due to the guide price,

it would attract first-time buyers.

So there should be plenty of interest in this house.

But what type of value would the agent place on this house

once the renovations are complete?

Once renovated, I believe this property could achieve a sale value

of £150,000 on the open market,

and rental of between £650 and £675 per calendar month.

I do like this house.

It has got a bit of a strange configuration,

but there's a lot of space in there which, to me, equals potential.

But still a lot of work to be done,

not least out here in the back garden.

But let's see who fancied it when it went under the hammer.

I'm going to say 95 to start.

Got to be that, I think. 95 bid, thank you.

At £95,000.

100 can I see now?

Surprisingly, the bidding took time to get going,

but climbed in £1,000 steps.

We rejoin at £110,000.

In the aisle at £110,000. Another 500 anywhere else?

110,500.

No? At 110,500, the other side of the aisle.

111 anyone else?

If not, 110, 500 once, 110,500 twice.

Third and final time, 110,500.

You bought it, sir, well done.

That successful bid of £110,500

came from father-and-son team Ian and Cameron.

MUSIC: Wild Thing by The Troggs

ENGINE PURRS

# Wild thing

# You make my heart sing... #

Motor enthusiast Ian is a first-time renovator.

He's preparing to retire from the oil industry,

so I got my motor running and met him back at the property

to find out his plans.

Ian, nice to meet you. Congratulations as well, sir.

-Thank you very much.

-What was it that attracted you to,

not just the house, but the area as well?

We live locally and my son's done a little bit of research, you know?

So he kind of spotted this one that was coming up on the auction

and I was quite happy with going for it.

So it's all about your son, then?

He's 19, he's a big, strapping lad,

so hopefully he'll get torn into the garden as soon as we

get settled in and get busy with it.

He's due back from holiday today, so...

So is it Cameron that's behind you guys getting into the property?

Was it his idea or your idea?

-It's more Cameron's push, to be honest with you.

-OK.

It is more Cameron's push and, er...

..with me working away in the oil industry,

and the oil industry's on a bit of a downturn at the moment,

we wanted a bit of diversity.

I do two weeks away on the rig, I have two weeks' free time,

-so I can really get tore into the property.

-OK.

So this is one of maybe a couple

that we're hoping to do in this year, next year.

-Have you got people to help you out?

-Well, I'm fairly handy myself.

-OK.

-And part of this DIY is to pass on the DIY to my son, you know?

-OK.

Whereas previously, working on our own home,

we've certainly known some good tradesman locally,

so we'll be getting the experts in for the expert bits.

Yeah, of course. The safety...

The safety, yes, the electricals and obviously the gas, etc.

It's not a bad start.

It seems to be quite a solid property.

-Yes, yes.

-You've got a bit of space out the front as well.

We've got the opportunity for off-road parking,

so we're certainly looking at that, because...

you know, there's a substantial plot out the front there.

Inside, it's a bit of a strange configuration, isn't it?

It is. Just slightly, yes.

What are you going to do? Are you going to change it at all?

Are you going to keep it as it is? Just give us a bit more detail

-of what you're going to do.

-Well, starting in the wet room,

we want to make that a utility and, you know,

we want to certainly retain the toilet,

move the toilet over and stud-wall it out

and obviously have that separate.

The kitchen, with being a fair size,

we were hoping to look more towards maybe removing the chimney breast

and equally, with the two rooms downstairs,

we were just going to retain them as they are at the moment.

And the bedrooms upstairs are of a good size.

Ian and Cameron have set themselves a timescale of two to three months

and a budget of £7,000 to £10,000.

Based on the agent's valuations,

that should give them a decent profit if they decide to sell.

But they haven't made their minds up yet.

Either way, hard work will be required to keep them on a budget.

And do you see yourself - you and Cameron -

coming here in the morning and getting mucked in and...?

I'm hoping so, yes.

Yes, well, he does a 12-hour shift now

-with his local firm that he works for.

-OK.

So he'll be used to that, and hopefully,

we'll get a good 12-hour shift out of him.

So I'm looking forward to that, that's for sure.

I've got lots of promises, so we'll see if him get tore into it.

-So, good luck, sir.

-Oh, thank you, Dion.

-Sounds like a very sound partnership.

-Well, I hope so, yes.

-I wish you all the best.

-Thank you very much indeed, thank you.

It's good to hear that Ian's done his research.

Or should I rephrase that and say, it's good to hear Cameron, his son,

has done his research for him.

But between them, I've got to say,

they've found themselves a decent first project.

Now, Ian's willing to get stuck in,

get his hands dirty and get this project sorted.

Will Cameron do the same?

You can find out later in the programme.

Lucy's in Gillingham, in Kent -

a bustling, modern town with great shops,

a university and good rail links to London and Dover.

But things weren't always so peaceful.

Back in 1667, this town was the site

of one of the worst defeats in Royal Navy history.

Now, during the Second Anglo-Dutch War,

a Dutch fleet sailed up the river Medway, attacked forts,

burned English battleships

and basically invaded Chatham and Gillingham.

It became known as the Raid on the River Medway.

Fortunately, the Dutch didn't stay long

and Gillingham is now still very much part of Kent, not Holland.

So I'm going to now go and check out some property.

Well, I'm just quarter of a mile from the high street

and here's the property that went to auction.

Now, it's a two-bedroom mid-terrace

and it had a guide price of £120,000 to £125,000.

Oh, that front garden has seen better days.

Still, onwards and...

Er, it looks like upwards.

Ooh, two huge steps outside before you even get in the door.

So that's something people with buggies and the elderly

might want to think about.

But, once you're inside, it's, um...

It's not quite as I expected.

I have seen so many of these terraced houses before

and usually, the stairs go up this way.

But already, somebody's been in and they've turned the stairs around

to allow for more space upstairs, I'm sure.

So I don't think the stairs would have originally been here,

which is quite interesting.

But it does make it work really well in here.

As you can see, bit dated - you've got textured ceilings up there,

lots of different-coloured paint.

But, through this room,

THAT is where the stairs would originally have gone.

All the way up and then the two rooms either side.

And then through here is the second reception room -

again, very similar to the first, textured ceilings, a bit dated.

You have got central heating in here, though, which is a good thing.

But enough space to maybe have your dining table.

But something else that again is bothering me a little bit -

it's the different levels.

The kitchen is down here, but, again, it's two big steps down,

just like it was coming through the front door.

Bit of a small kitchen, definitely could do with upgrading,

and bit of a shabby lean-to outside.

I'm going to take a look.

# You gotta step it up and go

# Well, you can't stand back

# You gotta step it up and go... #

Ah, a Hammer regular - a dodgy lean-to.

It will need to be demolished or replaced.

As for the garden, well, what can I say?

It's small, paved and needs new fencing.

Time for Lucy to head back inside and upstairs.

So, upstairs, well, let's have a look.

Just as I expected.

Now, I mentioned downstairs that the stairs had been turned

to create more space, and upstairs

is where it really does work a treat.

Now, originally, this wall here - partition -

would not have been here.

This would have been one big bedroom

and you would have had to have walked through the big bedroom

to another big bedroom right at the end.

But now they've moved the bathroom up at the end,

they've created a partition here.

It does make the second bedroom so much smaller.

But it allows independent access through into the now bathroom,

and I think it really works.

I think the layout is perfect.

In fact, I don't think I would change a thing up here.

# Don't go changing

# Trying to please me

# I'll take you just the way you are... #

Losing a bedroom may sound like a bad idea

but if it helps a property flow better,

then it can be the way to go.

So, at a guide price of between 120,000 and 125,000,

could this potentially make a good return for an investor?

We asked an agent with knowledge about this area for his opinion.

This probably needs complete redecoration, refurbishment,

new kitchen, new bathroom, and that's about it, really.

I wouldn't alter the layout at all.

I don't think it would be cost-effective.

I think it's a house and it's fine as it is.

Agreed. But what type of budget does the agent think buyers may need

to refurbish the house?

I would estimate a refurbishment budget of about 15,000

would probably cover it.

OK, taking the top end of the guide price at 125 grand

and the agent's figure of 15,000 for refurbishment

would mean a potential investment of 140,000.

So what could it sell for?

If I was asked to market this property,

I would probably list it at £170,000.

This two-bed terraced doesn't need too much work.

In fact, quite a lot of the work has already been done for you.

Although it's tired, it's dated, it needs a new kitchen and bathroom,

and certainly some redecoration, but it could be completely transformed.

So let's find out who fancied taking this terrace on

when we head to auction.

120 to 125, the guide.

Start me at 120.

Should be hands shooting up everywhere. £120,000.

Start me at 110, then.

Get me on the way. £110,000.

I'm on the way at the back at 110.

At 110. And 112.

112, I've got.

And 14. 114.

And 16.

116. 116, on the left.

118, now.

118. And 120, if you like.

120 if you like.

120, I have. And two.

122. It's back to you again. 122.

At £120,000, I'm bid.

122, I'm looking for.

Sorry, right by the door, 122.

And four. It's against you.

124. And six.

And eight. 128.

At 126, standing.

128 is against everybody else.

At £126,000, then, for the first time.

128 right over in the back corner.

At opposites. 128. 130.

And two. 132.

Back to you, sir, at £130,000.

For the first time, then, at 130.

For the second time at 130.

If you're sure you're all done at £130,000.

With you standing on the left-hand side - all done?

-GAVEL BANGS

-It's yours at £130,000.

The winning bid of 130,000 was made by Prakash

on behalf of himself and long-term friend Man.

Originally from Nepal,

this is to be their first venture into property development.

Lucy met them to find out more.

Guys, congratulations.

Lovely to meet you, Prakash.

-Thank you, Lucy.

-Man.

-Thank you.

So what's the story behind you two buying this?

We are ex-soldiers.

-You're ex-soldiers?

-Yes, ex-soldiers.

-Yes, we are.

-Royal Engineers. Gurkha Engineers.

-Gurkhas?

-Yeah, in the Gurkhas.

-Amazing.

Thank you. And we thought, "Why don't we try a new venture?"

So how different is this to being in the Army?

When we were in the Army, we did lots of construction jobs like this.

But when we left the Army, he's doing electrician,

and I was gas engineer.

An electrician and a gas engineer?

-Yeah.

-Yes.

-So handy. I mean, so incredibly handy

to have those type of skills in this industry.

-NEPALI NATIONAL ANTHEM PLAYS

-So they may be doing this

for the first time but these ex-Gurkhas have skills

that are invaluable and will get them off to a great start.

To give them a bit of encouragement,

we're playing their home country's national anthem.

Nepal.

But they and their respective families

have a good knowledge of Gillingham

gained after the Army posted them here.

So what is the plan? Why have you bought this?

New business, new venture.

Maybe we could do the business in the properties in the future.

But is this for you to live in,

or is this for you to add value and sell on?

-Add value and sell it.

-Yeah, we are planning to.

-You certainly can add some value to this property.

-Yes.

-Yes.

Interestingly, I have seen so many houses like this in my time.

But to see it where the stairs have already been turned around...

-Yes.

-Because, originally you'd have gone up the stairs that way.

-Yeah.

But they've already turned the stairs to create the corridor

-upstairs to allow you independent access into the bathroom.

-Yes.

-So that job has been done for you.

-Yeah.

Because, otherwise you would have had a much bigger second bedroom.

-That's right.

-But no independent access into the bathroom.

So quite a lot of that work has been done.

How do you feel about that?

-We are quite happy.

-It's saved a couple of grand.

-Saved you a bit more than a couple of grand.

-Yes.

-That's right.

So that job's done and dusted.

I mean, obviously, completely,

it needs a new, you know, everything -

windows, doors, floors.

Are you two going to be doing a lot of the work here yourselves?

-Yes.

-Yes.

We will do...

boilers, gas, electric, water, these things.

And maybe...

we will do the DIY stuff as well.

But if we get what we are looking for, price-wise,

we will give to the builders.

So what is your budget? How much have you got, Man?

We're looking about under 10 to 15 grand.

£10,000 to £15,000 to do the whole house?

-Yes.

-Yes.

-10 to 15, yeah.

I mean, what's your ultimate price you'd like to sell this on for?

We are not planning the...

Right now, it's the most that we can make it. You know?

We will learn more things than we make the money from this property.

We are planning about, er...

..160? And hopefully it will be fine. Yeah, 160.

So this, for you guys, is more about the learning process?

-Learning process.

-Yes, it is.

Coming on board, seeing where you go wrong.

-That's right.

-Trying to source materials.

-That's right.

-And just seeing how it goes.

-Yes.

-How it goes, yeah.

How long is it going to take you, do you think?

-About 6 to 12 weeks.

-About 6 to 12 weeks.

-6 to 12 weeks?

-Yeah.

-Yes.

When do you plan on starting?

-Tomorrow.

-Yeah.

-Really?

-Yeah.

So, 6 to 12 weeks, you're going to get in here

-and then do the work and get out and then put it up for sale?

-Yes.

Good luck with this for your first project together.

-Thank you very much, Lucy.

-Good meeting you both.

-Good luck.

-Thank you.

-Thank you.

Former soldiers Prakash and Man have decided to use their skills

they've acquired in their day jobs as a gas engineer and an electrician

and start property developing together.

Now, this is their first auction purchase

and I don't think they've done badly.

It's in a central location, it doesn't need too much work,

and a lot of that, well, they can do themselves.

We'll find out how the duo get along,

and will they stick to their 6 to 12 week timescale?

Join me later in the programme.

Coming up, this three-bed semi

in Sheffield's retro stonework doesn't impress.

A fireplace a little bit more 2016 would be nice.

And it's an unregimented work life in Gillingham.

In the Army, you have always boss.

In here, you are the boss for yourself.

Back now to Stafford in the West Midlands.

It was here I looked around this good-size semidetached property

which had three bedrooms and an attractive guide price of 105 grand.

Inside, it was dated and tired but packed with potential.

Although I had my concerns about managing those purse strings.

I think you'd have to spend maybe £8,000, £10,000 on this house

just to get it right, and that takes your costs

to maybe £113,000, £115,000.

That's if you got it at the guide price.

Now, I think if you're taking on a project like this,

especially this one, you would have to watch your budget.

# Go easy... #

Yes, there was a ceiling price in the area,

but, with a guide price of 105 grand,

it could be a sound investment in the right hands.

£100,000. 101. 102.

Surprisingly, this house went for £5,500 over the guide price.

Ian, an oil-rig worker, and son Cameron, an engineer apprentice,

bagged themselves what seemed like a good deal.

You've bought it, sir, well done.

Bought for £110,500, this property purchase

was a new venture for Ian and his family.

Is it Cameron that's behind you guys getting into the property?

Was it his idea or your idea?

It's more Cameron's push, yes, I will be honest with you.

It is more Cameron's push.

I do two weeks away on the rig, I have two weeks' free time,

so I can really get tore into the property

with that two weeks' free time.

So this is one of maybe a couple that we're hoping to do

in this year, next year.

So Ian and 19-year-old son Cameron hope to get this property

up and running in two to three months

and for a budget of around 7½ to 10 grand.

We're back ten months later and, straight away,

we can see they have created parking spots for at least two cars.

Very wise decision.

But does the good work continue on the inside?

The living space is now full of light and feeling fresh,

thanks to a lovely subtle colour scheme and excellent carpeting.

I can't wait to see what they've done with that kitchen.

Well, it's brand-new and modern.

Like the rest of the property, it's been rewired throughout.

What became of that wet room?

The wet room originally was all one size.

It was the toilet and the big wet room,

so me and Cameron just decided we'd put a new stud wall in there,

retain the wet room facility,

having the extra shower for a family downstairs,

but we needed the utility for the washing machine and dryer,

so we decided that would be the best way forward for that one.

Built the stud wall and that's the end result,

and we're quite happy with that.

It's good, practical thinking by those novice renovators,

and those good decisions continue upstairs.

All three bedrooms have been skimmed

and redecorated to a really high standard.

The bathroom suite is brand-new and a huge improvement.

Outside, the garden is no longer a jungle

and they've created a patio area just off the French doors.

As first renovation projects go,

Ian and his family have done an incredible job,

but it has come with some challenges.

When we first got the property

we kind of had a good look around it and started to rip the carpets up

and everything and realised that we had what we call red ash.

We realised we had to dig all of the concrete out

and all of the red ash out.

Around about 60 to 70 tonnes,

that's every floor downstairs had to be removed.

So basically we got the impact gun and took the concrete out

and we had to physically wheelbarrow it all out and pickaxe it all out,

so that was time-consuming. That was one we hadn't planned for.

Red ash is a type of material that contains sulphate

and was commonly used between the 1940s and the 1970s

as infill under concrete flooring.

Unfortunately, because sulphate reacts to any damp,

it can rise up and crack the concrete

which affects the property's brickwork.

The only way to deal with it is to dig it all out,

so I'm guessing that £7,000 to £10,000 has flown

out of those double-glazed windows.

Obviously with the red ash being the main problem, all of

the kitchen had to be destroyed and pretty much started again there,

so the budget went through to about just over 15,000.

What a learning curve from the red ash curveball.

It's not been all work and no play, though.

A family celebration and holiday

have helped stretch that three-month timescale to nine months.

But let's find out what two local agents think,

starting with the one who saw it before.

It's a truly magnificent change, absolutely wonderful.

From the first time I came here, lots has been done, lots of refurbs,

looking great, neutral throughout, wonderful carpets,

they have done a grand job.

First impressions of the property

are that it has been well turned out, it's nice and fresh

and it would make a lovely family accommodation.

It's essential that this red ash was eradicated.

There will not be any problems now with mortgaging the property.

That is good news, but let's get into the numbers now.

Ian has invested a total of £125,500,

but is not sure whether to sell or rent,

so will the valuations help him decide?

On the resale market I would envisage the property being

in the region of 150,000-155,000.

Or if the property is rented out,

then I would envisage a rental of £650 per calendar month.

I think to resale this property on the open market we would achieve

between £165,000 and £170,000.

And for rental, between £650 and £675 per calendar month.

Quite a big difference in the sales valuations there.

But if Ian did get that top value of 170 grand,

that would mean a pre-tax profit of a whopping £44,500.

And if they decided to rent,

that top rental figure of £675 per calendar month would mean

a yield of just under 6.5%.

So does Ian have a difficult decision to make?

We'll sit down as a family,

discuss the way forward on that one and certainly...

..take a vote. But I think

personally we're all edging towards renting it out at this stage.

The city of Sheffield in South Yorkshire

is synonymous with steel production.

It's been making it since the 14th century.

Many countries claim to have invented stainless steel.

Like lots of great inventions, the origins are disputed,

but Sheffield celebrates its own Harry Brearley

with this locally produced stainless steel sculpture

called Cutting Edge,

which proudly stands in front of the railway station.

Well, a bit like Rome, Sheffield was built on seven hills.

Luckily the property I'm here to see

isn't going to cost you three million shekels and a camel -

it is £45,000, which seems like a pretty good deal

for a three-bedroomed semidetached

in this elevated position. Let's have a look.

Now, just before you write in,

I know there is a dispute about the seven hills thing

and that some people regard it as a bit of a myth,

but there is no disputing that this property sits on a hill.

HE GASPS

Slightly puffed out after that hike to the front door,

but the elevated position - yeah,

a lot of people like that

and there's storage underneath, which is good news. So,

through the front door you've got a little entrance area there,

stairs up to your bedroom.

Then into basically the main room,

in fact the only room apart from the kitchen on the downstairs floor.

It's a good size, very high ceilings, which is nice.

It's obviously a little bit dated,

the colour scheme won't suit everyone.

A fireplace a little bit more 2016 would be nice.

That's a little bit '80s, '90s, isn't it?

But you could have some feature there, an open fire or whatever.

But let's explore through this little area here

which is a nice space to dump your bags and your bikes or whatever,

and into the kitchen.

Now, again it's very much of an ilk of this kind of property,

but I really like the high ceilings.

That's a real bonus.

I wonder if a potential purchaser is living in Cloud Cuckoo Land.

I think not, this is a really great property.

But that...

..is a little bit random.

What on earth do you think's out there? Mariana Trench?

Oh, well. Wish me luck.

HE SCREAMS

SPLASH!

Only kidding! As far as I can see so far

it's a pretty normal back area.

It's got a nice garden there,

stretching quite a long way up as you might have imagined.

Ah!

Right.

That's the deep water, then.

How deep is this little pond?

The mind boggles. Let's have a look.

Right, about a foot.

Oh, well, still, never can be too careful with water.

Yes, joking aside,

even shallow ponds like this can present a danger to small children.

Between 1995 and 2005, 28 children drowned in ornamental ponds,

so best cover it, fence it or fill it in.

A pretty good use of space, a staircase like this,

because you get basically up a considerable height

because the ceilings are very high in this place

in a relatively small amount of room, which does give lots of space.

You have three bedrooms, which is good news.

A bathroom here.

Bit of a disappointment, though, it doesn't have a bath in it.

It's got a shower. So, I wonder if

there is some careful modifications there you could do

to get a bath in there,

because most people do actually still like a bath.

Bedroom at the back, half-decent size.

Smaller box room there.

And then through to your master.

As is so classic of properties of this era,

the old built-in wardrobes with that sort of material.

I think it had a special name, didn't it,

that all these things were made of in the day?

Bay window, though, and again, quite a nice size space, so...

All in all, I think, a good little house.

A medium-sized house.

Melamine, that's it. Melamine.

I knew it would come back to me eventually.

Well, wardrobe-building material aside,

what does a local property expert

from the auction house who sold the property think of it?

We're in Firth Park, Sheffield,

which is the north side of Sheffield.

This location is close to Sheffield town centre.

Wide range of amenities, good transport links,

and very close to the M1.

Also, the added benefit of being very close to the Peak District.

Peak District, you say.

That probably accounts for some of those seven hills.

But that's the property.

First impressions - this property's tired, it's dated, it's stale.

It needs a new kitchen, new bathroom,

and complete upgrading throughout.

Unusually for a house, this property is leasehold.

How does he feel about that?

Historically, yes,

there is an association with leasehold properties with flats,

but there are properties out there which do have a leasehold.

I would certainly look at the legal pack

and check how much service charge or ground rent is applicable.

My view would be that it would be probably a nominal amount per annum.

But it turns out your view is spot-on.

The ground rent is £2.50 a year, and there's no service charge.

So, would this make a good rental property?

With regards to renting the property out,

you're looking within the region of £500-£550 per calendar month.

With a guide price of £45,000 plus refurbishment costs,

would there be much headroom for a profit on sale?

Once the property's renovated and properly refurbished,

you're looking within the region of £90,000-£100,000.

Well, joking and larking about aside, this is a good little house,

and for a very attractive guide price.

So, let's see who fancied it when it went under the hammer.

Lot 29.

Start me where you will on that one.

48 to start me.

45. Three-bedroom house at 45,000 - doesn't sound dear to me.

45, thank you.

45 I've got as a starting bid.

At £45,000. 46 somewhere else?

45 is my opening bid.

46. 46, 47.

48 is bid.

48, 49.

At £49,000. 50?

50.

Bidding was intense, not just in the room but on the phone also.

We rejoin at 55,000.

55,000, 56.

56. 57?

56 and a half? 57 on the phone.

57 and a half. 58...

Two bidders then pushed the property up to 60,000, where we rejoin.

At 60. 500, quickly.

Yes? 60 and a half.

60,500 is the bid.

£60,500. 61.

£61,000 for the first time.

For the second time, 61,500.

61,500. 62.

62. 62,000 once, twice, third time.

GAVEL STRIKES

Sold on the phone at £62,000. Thank you.

That phone bidder getting the property for 62 grand was Sajid.

He currently has two other rental properties,

and he does this as a hobby.

Sajid, great to meet you.

-Congratulations.

-Thank you very much.

Now, we didn't see you at the auction, did we, there?

No. When I spoke to the auctioneers,

they said, "Well, if you can't attend, we do a telephone bid."

Was that the first time you'd done that, was it?

It was the first time I've bid off the telephone

-to purchase a property at auction.

-And how was it?

I think it was great, and I thought, yeah, let's go in.

Go for it. Brilliant. Before we talk about the property,

tell me about you. What do you do?

-I'm a lecturer.

-Oh, great.

I'm a lecturer at the University of Sheffield.

-Oh, brilliant.

-In accounting and business studies.

OK. So, the numbers on this have got to be spot-on, haven't they?

-Let's be honest.

-I've got to get my budget right.

You get it wrong, your students are just going to

-so take the mickey out of you.

-Yeah.

Initially, when I saw the house before the auction,

normally they're derelict or they need a lot of work doing.

My interest in this property

was purely because there's not a lot of work that needs doing.

So what was it, then, about this house, other than the fact

that it didn't need a lot of work necessarily doing to it?

What did you like about it?

Um... A number of factors. I think, location,

that was one of the prime factors.

Hospital is just behind the... It's parallel.

One of the largest hospitals in Sheffield.

So easily lettable as well

and probably easy to sell on as well and make a nice little gain.

So tell me what you're planning to do to it, then.

I think I'm going to... cosmetic improvements.

-Get rid of the colour scheme.

-Yeah, colour scheme.

In this particular room we've got a number of colours.

And just make it more modern, the modern touch.

And the kitchen, probably going to modernise that as well.

Probably just cosmetic decor.

-Right.

-The garden, probably get the garden...

..cleared, there's a pond there,

look at the pond, see what needs doing

-and just upgrade it, basically.

-Right.

And I do hope that Sajid's modernisation programme

extends to the fireplace -

and also, who's going to do the work?

Some of the work I'll do myself, where I can.

-Yep.

-But where you've got the plumbing work,

electrics, I'll get the proper professionals in.

OK. So what's the budget?

My budget on this...

Like you mentioned, I've got to be right on this.

-You so have.

-I think...

-To within three decimal points.

My budget on this would be probably no more than four grand.

That's too round. I want more.

£4,637.27.

I'd probably say around 4,500 would be my budget

-on modernising this, bringing it up to standard.

-Right, OK. Yeah.

And then from there,

whether I decide to let it out or whether to sell it,

I'm not sure yet.

-Not sure?

-But it'll be interesting to know what the agents say.

So what kind of profit would tempt you to sell?

Um...

-Ten?

-Ten grand. If there's ten grand in it, you'd just move it on

and do that, otherwise you'll rent it out.

Otherwise, yeah, like I said, the hospital's local,

there's plenty of professionals there

that are looking for accommodation around here.

So, timescale for everything?

Probably within... Probably I'm looking at two months.

Two months. At university, though, you lecture in business studies,

-is that right?

-I lecture in accounting and business studies.

Accounting and business studies.

So what do you think about property developing as a business?

I wouldn't say I'd become a property developer, but it is

like on the side, an interest that keeps me busy, actually.

-Yeah, yeah.

-And it's another way to

either make a long-term investment or a quick capital gain.

Yeah, good stuff. Well, listen, congratulations.

-Thank you.

-And well done.

-Thank you.

-Look forward to seeing how you get on.

Thank you very much.

So a telephone bid from Sajid secures the property.

Will his £4,500 budget

secure a very pleasant renovation?

Well, you can find out later in the show.

Well, we've seen how one of today's properties turned out

but what about the other two?

Yes, have these projects gone to plan?

Yeah, I think it's time we found out.

We're back now to Gillingham in Kent,

where Lucy looked around this two-bedroom mid-terrace,

which was up at auction for a guide price of £120-125,000.

The good news was that the previous owner had done some valuable work.

I have seen so many of these terrace houses before

and usually the stairs go up this way but already somebody's been in

and they've turned the stairs around

to allow for more space upstairs, I'm sure.

This is always a clever plan because it creates independent access

to two of the bedrooms,

one of which can then be turned into a family bathroom,

which had also been done, probably, in the '80s,

judging by the colour of the suite.

The property was also sold with a gas central heating system

but there was still plenty of work left for the new purchasers.

Retired gurkhas Prakash and Man

paid 130 grand for their first venture together

and they certainly had some valuable skills.

An electrician and a gas engineer.

-Yes.

-So handy,

so incredibly handy to have those type of skills in this industry.

They were confident in their specialist trades,

but were on a steep learning curve

when it came to the more amateur side of things.

Maybe we will do the DIY stuff as well.

So this for you guys is more about the learning process.

-Yes, it is.

-Coming on board, seeing where you go wrong.

-That's right.

-Just seeing how it goes?

-How it goes, yeah.

To find out how it went, we're back just 34 days later,

well ahead of the 8-12 week forecast.

That should bolster Prakash and Man's faith in their own abilities.

# Hey, believe in me

# Cos I believe in you... #

Neutral tiling and a new white bathroom suite

modernised this space completely.

Downstairs in the lounge, the neutral tones continue.

# Hey, believe in me

# Cos I believe in you... #

The same can be said for the rear reception room

and the new kitchen has a much-improved layout.

It took some rearranging,

but Prakash is only too happy to explain their strategy.

We started from...door was here

and we blocked the door.

And we lay out this lovely, nice, functionable kitchen here.

We moved that basin towards there,

hobs too a little bit,

tile, ceiling, new radiators.

Everything we did here

and it's lovely now.

Unfortunately, the old boiler was beyond repair.

So the skills of gas engineer Man came into play,

while Prakash's skillset helped sort out

the house's other energy source.

# Electricity... #

The lean-to has been spruced up

and neutral carpeting gives a flow upstairs

and throughout the bedrooms.

The majority of the ceilings have been replaced with new plasterboard

and skimmed, and it was whilst working with this new material

that a new unexpected discovery came to light.

When we cut the plasterboard there and we found the...

There's a lovely cellar there.

-Didn't we?

-Yes.

-Yeah, we did.

The guys have certainly come a long way

up the refurbishment learning curve.

A steep journey, a bit like those cellar steps.

So how does it feel?

I did not expect we can lease this house in three weeks,

but it's finished.

-We did it.

-We did it.

-We did it.

You certainly did do it, and a very nice job it is too.

So will there be more in the pipeline?

This is the beginning. There's still more properties to attend.

Still we are working together.

A formidable team, just as they were in their former jobs.

There are still some finishing touches to do,

like the car park at the front, but leaving that aside,

how did the £10-15,000 budget fare?

We spent about just over 11,000.

Just over 11,000.

Excellent. Time to stand at ease now, boys,

as we call in not one but two local estate agents

to establish the value that's been added here.

First on parade, the agent who did the reconnaissance

just last month before battle commenced.

I think the changes are really good

and the speed has impressed me as well.

To get to this stage in four weeks is quite amazing.

I think the property is very nice. It's a nice size property

and I feel the new owners have come in and done a really good job.

It's all decorated nice and neutrally

and hopefully it would attract a wide range of buyers.

The boys' work has passed the professional inspection.

Prakash and Man's intention was always to sell on,

to recoup capital and get another property to do up.

But if the order of the day was to rent out,

what rental could they achieve?

I feel this property could achieve on the rental market between

£800 and £825 per calendar month.

I think the rental value of this property is approximately

£850 per calendar month.

Which, if fully let, mean the chaps could realise around a 7% yield.

That's good. But we want to go for sell, isn't it?

Yeah, we'll go for sell.

Adding their refurbishment spend to their purchase price,

you get just over £141,000, so what's it worth now?

I feel this property will achieve between £170,000 and £180,000

on the open market.

I think this property would sell for approximately £175,000.

Taking the top figure,

that's a potential profit before taxes and expenses of £39,000.

Does that meet muster, chaps?

-So pleased with the value.

-Very pleased, yes.

Good news for us.

We worked so tirelessly hard in three weeks

and reward is getting there, on the way.

Well, the hard work has certainly paid off.

So what's been the biggest contrast between the old and new careers?

In the army, you have always boss.

In here, you are the boss for yourself.

That's the thing.

-That's how we like it.

-Yeah.

Back to Sheffield now

to see what progress Sajid has made with his three-bed semi.

Sajid is a university lecturer in accounting and business studies

and he paid £62,000.

With that background, surely he would be watching the pennies.

So what's the budget?

My budget on this... and like you mentioned,

-I've got to be right on this, haven't I?

-You so have.

-I think...

-To within three decimal points.

My budget on this would be probably no more than four grand.

Four grand. That's too round, I want more. £4,637.27.

I'd probably say around 4,500

would be my budget on modernising this and bringing it up to standard.

-Fine.

-And then from there,

whether I decide to let it out or whether to sell it,

I'm not sure yet.

He thought it would take two months,

which was generous given there wasn't really too much to do.

Just one month later, we're back!

Got the walls all painted.

Painted white, got the ceiling painted as well

and the doors as well to give it that extra modern touch.

Oh, well, we could go down the conventional route

and find a piece of music about paint.

# I know what I like and I like emulsion

# Music is the sound of painters painting, paint, paint... #

But that's probably going to be about as entertaining as, well...

watching paint dry. So, instead, here's a new game.

Let's play...

I'll give you an easy one to start.

Were these shots of the bathroom taken

before or after the renovation?

Yes, that's right, they're after.

Remember the telltale clues

of stickers warning not to use the units.

Sajid had his plumber sort out the bathroom

and check the boiler while he was at it.

Now, a slightly trickier one.

Are these shots of the lounge taken

before or after Sajid's extra-modern touch?

Well, they were after,

because before, there was dark red paint before the dado rail

and taking away the chimney breast would have involved building regulations.

Getting the hang of it? Now, to the kitchen.

Is this how you remember it from four weeks ago?

Well, does it look new to you?

It should do. These are actual refurbishment shots.

This is how it looked before.

Subtle, that one. But the absence of the sticky tape was the giveaway.

Upstairs, there are more obvious clues,

like the bed and the powder blue wall.

They were before. The contrast is clear.

As for the other bedrooms - well, they speak for themselves.

Outside, the before looks marginally safer than the after.

But Sajid has got gardeners coming back to finish it off.

So what's his overall impression of the work?

It's got the modern touch now.

It's more in a sellable condition for first-time buyers

or whoever wants to, if I decided to sell it.

Or even if I decided to rent it,

I think it's more presentable now than it was before.

Clearly, there is no more painting needed.

But are all the jobs completed?

Internally, I've got the extractor fan, that's going to be fitted,

where the gas cooker is in the kitchen.

And I've got the upstairs bedroom, front bedroom,

where the carpenter is coming to sort out the carpet

cos it's a bit uneven.

Plus, there is a new kitchen window on order.

So how is the budget?

My initial budget was 4,500.

Around 4,500 to get it renovated.

At that time, that included probably changing the kitchen

and the fireplace, but then

I thought, well, hang on, I don't really need to go that far yet.

So my cost so far has been approximately 1,500 I've come in at.

Your students will be proud, and with his business studies hat on,

Sajid is waiting for the valuations before

deciding whether to rent or sell.

So it's time to help him out with that.

Two local property agents came along to give us their thoughts.

My first impressions are that it's a good size property with lots of

space, versatile accommodation, but the finish isn't great.

More could have been made of it.

I think the selling points to the property are

that it's a good size three-bedroom semidetached property

and it's close to good

local amenities and Northern General Hospital.

Being close to large employers, like hospitals and universities,

is always good for rental purposes.

Sajid paid 62 grand at auction

with a further £1,500 on repainting and, um...refurbishing.

So, once the experts give us the rental forecast,

we can all work out Sajid's potential yield.

If I were looking to offer this property to the rental market,

I would anticipate a monthly rent

being achieved of somewhere in the region of £500 per calendar month.

For rental valuation,

I would expect it to achieve around £525 per calendar month.

I'm certain Sajid's accountancy students will have done the mental

arithmetic and concluded that taking the top rental figure equates to

a yield of just over 10%.

And people say accountancy is boring! No, no, no.

That's a great return. I mean, I've only had it for four weeks

and I've had people knocking on the door.

I've had people from the hospital, which is quite local,

calling me as well.

Could his £63,500 investment

have gained any value in that short time?

I would expect the property to achieve around £80,000.

If I were looking to put this property on the market,

I would anticipate a sale being achieved

somewhere in the region of £85,000.

A massive potential pre-tax profit of 21,500.

Most of it achieved in just one month.

I think that's fantastic.

Yeah, in a matter of four weeks, a nice capital gain.

Now you can't gloss over that.

But since filming, Sajid has rented out the house at £550 a month

and he has replaced the washing machine.

Ever the business lecturing professional,

he'd like to point out to any potential novice developers

to pay attention to the legal pack and, in particular,

the matter of the other party's solicitor's fees.

A lot of agents now selling at auctions are putting in

1% of the fees, which we end up paying.

It could be greater than that.

It depends which auction you go to. So just be careful.

And my tip -

be thorough with your rubbing down and buy a good quality undercoat.

# Music is the sound of paint. #

If you are thinking of heading down to an auction,

I hope we've been of some help.

Yes, we tried to offer as much advice as we possibly can

and there's plenty more where that came from.

Yeah, so make sure you join us next time

-for more Homes Under The Hammer.

-Bye-bye.

-Goodbye.

-Goodbye.