Episode 51 Homes Under the Hammer


Episode 51

Property series. Martin Roberts and Lucy Alexander visit a flat in Preston with a low guide price, a house in Wiltshire with a surprise, and an old terraced house in Staffordshire.


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Transcript


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Hello! Buying your first house is a life-defining moment

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-and one you'll remember forever.

-Yes, but whether you're buying

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your first property or your 50th, buying at auction is still really exciting.

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And it really can be a heart-stopping moment, so join us for Homes Under The Hammer.

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Everyone knows that appearances can be deceptive, and auction properties can sometimes be difficult to read.

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Yes, the house may appear to just need a quick make-over, but really drastic surgery is needed.

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So, today, will it be just a case of a bit of filler in the cracks or a full renovation for our properties?

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The guide price is low, but the inside of this Preston flat looks absolutely fine.

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But you know what?

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There's a catch.

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There's a surprise in Wiltshire. This house has all the fittings but no occupants.

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It's all luxury! I'm not used to this.

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And, considering its age, you'd expect this Staffordshire

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terrace to be in a sorry state, but there's one big problem.

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It's those cracks that are really worrying me.

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All these properties went to auction, and we'll find out who

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bought them, and what they paid, when they went under the hammer.

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I'm in Lancashire for the first property under the hammer today.

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The canals here played a vital part in the Industrial Revolution.

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Well, Preston not only enjoys its history -

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the Lancaster Canal here - but its new-found city status.

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I'm off to see a property just two miles away to find out

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if this is a good place to invest in property too.

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Preston was awarded city status by the Queen in April 2002 to celebrate her Golden Jubilee.

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With over 32,000 students living here, it's certainly

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a vibrant place to be, so there is potential for student lets here.

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So how much do you reckon for a reasonably well-located, one-bedroomed flat?

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70 grand? 60 grand?

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50 grand?

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How about 10 grand?

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Well, that was the guide price, and, no, it wasn't a misprint.

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From the outside, the block does appear to be in decent order.

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The windows look fine, and the paintwork seems new.

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The grounds are well-maintained and there's parking, which is a huge benefit.

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The communal areas are good too.

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This internal stairwell is spick-and-span, so things bode well for this modestly priced lot.

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Now, for that kind of guide price, clearly you've got to have your expectations set pretty low, but...

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Oh, my word!

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..it's actually

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really OK.

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It doesn't smell, there's no...

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Fine! What have we got? We've got a bathroom there.

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OK, it's a bit old and tired and dated, but it's serviceable.

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Decent-sized bedroom. That's your one bedroom. Some storage cupboards

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here and then through to the main part of the flat. You know what?

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I've been in a lot of flats that cost a lot more than this and were in a lot worse condition.

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It's got storage radiators, so that's not ideal, but...it's not bad. Haven't found the kitchen yet.

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Oh, yeah, here it is.

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Again, look at it.

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Perfectly serviceable. I mean, think about that guide price.

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That was quite extraordinary, and it's a perfectly

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decent flat that you could move into pretty much as it is.

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But you know what?

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There's a catch.

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Of course, there would be.

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And the issue is quite complicated, and this is where you really need to make sure you read the legal pack

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at the auction, because it appears that there could be a bit of an issue regarding some work which

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has been done on the whole building which you, as an owner of this flat, could be responsible for.

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It's a bit of a potential issue, and, before you buy, you absolutely need to get the issues resolved.

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The problems stem from external rendering that

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was carried out to the block at a cost of 9,000 quid per tenant on top

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of the existing management charge, so, for any buyer, the first job must be to check out the legal pack.

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The next priority would be to do something about the colour of this kitchen.

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-# They call me mellow yellow

-Quite rightly... #

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In such a confined space, this yellow is not making me feel at all mellow.

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And new doors on the units wouldn't go amiss either.

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The carcasses look to be in good order, though, so I wouldn't go for a new kitchen here.

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The bathroom is OK, and the suite could stay if you were looking to save money.

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It may only need a lick of paint.

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However, I do think you should change the heating system.

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Storage heaters aren't for everyone, so a new gas central heating system would really set this flat apart.

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I've invited a local estate agent to take a look at the flat

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and give us some more information about the exterior of the block.

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There's been a big issue with the structure of the blocks.

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There's been a lot of work carried out, so, really, selling

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has stopped for probably about two and a half, three years.

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That explains the low guide price, because the rendering problem has created a bit of a stigma -

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not what you need if you want to sell the flat on.

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The new owner will have to investigate this thoroughly.

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What does this place need if it's to entice a buyer or tenant?

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The property's dated.

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I suggest a new kitchen and bathroom, new carpets and just paint it throughout.

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If the flat did sell for anywhere near the guide price of 10,000 quid,

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that would certainly leave scope in the budget for some decorating.

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Talking of figures, how much could someone stand to make here?

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When renovated, I suggest you market this property in the region of £28,000 to £30,000.

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Per calendar month, I suggest a rental of around £300 a month.

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I reckon that with a guide price of 10,000 and a potential resale value of 30, no investor should

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let the colour of this kitchen jaundice their opinion of this flat.

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So a decent enough flat, but the big issue here, of course,

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is who is liable for those costs associated with recent renovations.

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There does seem to be a bit of uncertainty, and one thing's for sure - if you're going to bid on

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this, you've got to be absolutely clear before the hammer goes down,

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cos, once it goes down, your position is decidedly weaker.

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Let's find out who went for it at the auction.

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So we go to lot 131 which is flat 7, Edleston Lodge,

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Grange Avenue, Preston,

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on behalf of the mortgagees.

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It's a vacant, one-bedroom, first-floor apartment.

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Make it nice and easy - someone give me 10,000 for it.

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10 there. Say 12?

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12, 14...

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Who are you pointing at? Sorry, I didn't see you there. 14,

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16, 18...

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17, then?

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17 here, new bidder. Will you give me 18, sir?

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No? Then it's with you, sir, at 17,000.

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Are we all finished at 17?

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No, we're not. 18 there.

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19, sir?

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20? Looking for 20.

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20 here. 21...

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22, 23, 24...

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23 on my left.

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Are we all finished at 23?

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I'll take 23 and a half.

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First time at 23, second time at £23,000...

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It's yours, sir, well done.

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The winning bidder who paid £23,000 is Phil.

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He's bought a flat in this block that's desperate for someone to save it.

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It was a controversial auction lot with a bit of a murky past, but has Phil unlocked all the secrets?

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I went to meet him at the property to find out more.

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-Phil, good to meet you.

-Hello.

-Congratulations.

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-Thank you.

-Didn't quite get it for the ten grand!

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No, I wasn't really expecting to.

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It was quite a low reserve, but it would've been nice to get it for ten, but, in the end, it was 23.

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Why do you think they put it at that kind of price? Was it just to attract attention?

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Yeah, there's been a few issues on the estate as well over the last two

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years, with external rendering and the maintenance issue, so I think

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it's putting a lot of people off buying into the area,

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-so I think that was maybe the crux of it.

-Right.

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This thing with the maintenance of the outside and the re-rendering -

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-that's something which covers a lot of the properties around here?

-It does, yeah.

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On this estate, they've basically asked for £9,000 off everybody

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who's got a flat on the development last year, to pay it on top of the management to cover the rendering.

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Now, there was a lot of grey areas in the legal pack, which was basically looking like whoever bought

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the property was going to have to pay that £9,000, but I looked into considerably, ran it by the

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solicitor, and we found a loophole that the previous person who had the mortgage was liable for it still.

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So, when we've bought it for 23, that's the price we've paid, 23,

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and the other party has to pay the £9,000.

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Phil is a lucky guy.

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# Some guys have all the luck... #

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Thanks to his thorough research before the auction,

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he knew he wouldn't have to pick up that £9,000 bill, so he bought when others were having doubts.

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-Why were you so keen to buy it?

-Just as an investment.

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We're coming up to year-end. I own a construction company. We're coming up to year-end with some surplus cash.

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Rather than it sat in an interest-bearing account paying 1%, we'll go and buy

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another property, and hopefully it turns it round in a couple of years, and we'll make a bigger percentage.

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So you're a developer, are you saying?

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We own a construction company, but we've got a development arm

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-to the company that does smaller stuff and one-off houses.

-Right.

-So we've bought a few, sold a few on.

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-At the moment, it's the right time for buying to rent.

-Tell me more about that.

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Er...we've probably done about a dozen properties over the last two, three years.

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Generally, for the first two years, it's buying it, refurb

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as quick as we can, and sell them on and making a nice, tidy profit.

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But we found that the profit margin then was going and going with the

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market changing, so we've got three or four now that we just rent.

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We'll look again in another two years. If it's the time to sell, we'll sell in a couple of years.

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As property prices are depressed but rent's holding up fairly strongly in

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Preston, Phil thinks this is a great time to buy, but why THIS flat?

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What won him over about this particular property?

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Nothing in particular. The price!

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-That's honest.

-I never actually saw the property before the auction.

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I know the area cos I'm from Preston, but I didn't actually come and look in the property.

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It was just the right price and I know the area for renting,

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-so I took a risk.

-You must've been delighted when you walked through the door.

-Yes,

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it's very tidy, and I'll get away with spending not a lot of money on it, so it's going to be good.

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-So what are you planning to do to it?

-Er...

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the kitchen is going to be changed - just a basic kitchen going back in.

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The bathroom - a basic bathroom suite to go in. And decorate throughout.

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If I spend any more than £6,000, I'll be upset.

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We don't want to see a grown man cry, but we may see tears of joy,

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because Phil has had a stroke of luck since buying the flat.

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We've got a database of tenants through the previous properties.

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We've rung round a couple that are on our list, and I've actually got a tenant geared up for it

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-who wants to be in in a month's time.

-Really?

-So we've got a reasonable rent.

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-We're looking at about a 9.5% return on it straightaway.

-What kind of rent are you getting?

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We're getting 350. We've agreed on 350 a month.

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-Right.

-And obviously we'll have to pay the maintenance fee out of that.

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Now, the maintenance charges are quite high, aren't they? Is that something that concerned you?

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They have over the last two years, cos they've been paying for this work,

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but I've spoken to the people who have the lease of the whole estate, and basically they've paid for all

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the work now, so the maintenance charges from this year on should drop back down to where they were

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three years ago, which is maximum £1,000 a year. And that covers the leasehold and the maintenance.

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Are you bothered about the value, because the values that we were given done up...

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-you're just on the cusp there, what you paid.

-It is, yeah.

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I'm not particularly bothered with it,

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cos I think it's still rumbling on with this scenario with the render. In two years' time,

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that'll be gone, forgotten about. It looks fresh, the estate.

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It's 16 years old, the property, but to first come up, it looks reasonably fresh.

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I think, in two years' time, the headaches of what's gone by

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-is forgotten about, and the prices will go up.

-So what could've been a headache is actually...

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-It's quite easy.

-Yeah.

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So he did his research, and the maintenance issues that scared some buyers away look resolved.

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There's even a tenant waiting in the wings for Phil's flat.

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Well, he didn't get it for that ridiculously low guide price,

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but I think Phil still realises that he got himself a bit of a bargain here.

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So how is he going to get on?

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Well, he's already got himself a tenant lined up, everything should go to plan, but you never know.

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Join us later in the show to find out how he gets on.

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As pretty as a picture and postcard perfect, Redlynch near Salisbury

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is a village on the fringes of the New Forest National Park.

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It's not just its setting that makes it popular -

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good schools and three pubs make this a hit with renters and buyers alike.

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I'm here to see a property that was on the market for 265,000.

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Now, the guide at auction was set at just £165,000, so what's the catch?

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Well, there isn't one. This was built a year ago and it hasn't even been lived in.

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Let's have a look around.

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Brand spanking new, but it's already got a name - Plum Tree Cottage.

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Although there aren't any fruit trees in the vicinity,

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this cottage certainly looks ripe for investment.

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Now, this is not a typical Homes Under The Hammer property for me.

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It's got luxury. New thick carpet here - look at this!

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And the front door - it's gorgeous and heavy.

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Now, I know this house was developed to a really high spec.

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For instance, these wooden frames here are made from wind-felled, locally sourced oak.

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All these appliances - the dishwasher, cooker, fridge-freezer - are all really good quality.

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There's also zinc-galvanised drains and down pipes and, if that

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wasn't enough for you, there's under-floor heating down here.

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It's all luxury! I'm not used to this.

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Cracked sinks, damp walls and subsidence are the norm for auction lots,

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so coming here feels more like one of our second visits to a revamped property.

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It's really rather unusual.

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Upstairs, there are three good-sized bedrooms and a shiny new bathroom, with a bath and separate shower.

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Everything's new!

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I am so excited by these here -

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modern bi-folding doors that open right the way back.

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They give more of a contemporary feel than the traditional French doors,

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and it just allows that sense of flow from the lounge out to the garden.

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I am all for them.

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It's all about bringing the outside in,

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and this house has lots of outdoor space, which is a huge bonus.

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It just needs someone to stamp their personality on the place.

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And I've made a discovery on the other side of the fence.

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Now, here's a bit of gossip. There were rumours of a proposed pub being built right here on this plot.

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Now, I imagine that would have put a lot of potential buyers off -

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the noise, the parking issues.

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Now, luckily, they were just rumours because the real truth is

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there's actually planning permission in place for five new houses to go up here,

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turning this bit of wasteland into something much, much more desirable.

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There are also another three new-builds nearing completion, plus Plum Cottage, so,

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with those five proposed new houses,

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you'll soon be spoilt for choice for new properties in the village.

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What will a local estate agent make of this one?

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I started by about asking about the setting.

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Very good village, very popular village.

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The local junior school is two minutes' walk down the road,

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and quite a lot of amenities.

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We're also close to the cathedral city of Salisbury

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for employment and rail links to London and the country.

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It's very peaceful and you've got an awful lot of local wildlife as well.

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Plus Plum Cottage for any Little Jack Horner developers looking to stick their finger

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into the local property market. So let's talk numbers.

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If the property was coming onto the rental market currently,

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I would expect to reach between £800 and £825 per calendar month.

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If I was to bring this property to the open residential sales market today,

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I would look to put this property on the market

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for between £190,000 and £200,000.

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Hang on!

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There's nothing to do in this house and it went to auction guided at £165,000.

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Considering you could sell this on for just under 200,000 as it is,

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I think there's a margin to be had here.

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Let's see who spotted this fantastic opportunity at the auction.

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Lot 18 is the property known as Plum Tree Cottage,

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an ideal investment being offered at a very sensible price today,

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ladies and gentlemen.

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Does somebody wish to get me under way at a very sensible £150,000?

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I need an opening bid.

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Thank you, sir. 150,000 I have got. I have an opening bid of 150.

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Now I need 151,000.

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151,000, madam.

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Right down here in the front. 151. I have the two bids. 152, sir.

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153. 153 from the lady.

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154. 155? 155.

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And 6? 156, sir, thank you.

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157, madam?

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157,000 clearly here in the front.

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158.

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159? 159 here in the front.

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160, sir? 160,000 we have.

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161. Back to you, sir.

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Thank you. 162. Nice and quick. 163?

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163 we have here in the front.

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Gentleman says 164. 164. 165?

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No, lady's shaking her head. Half?

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164 and a half. She's back in.

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Back to you, sir. 165?

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165 I have got. Thank you.

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Saying 500, madam?

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No, she's shaking her head at me.

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She's out of the running. £165,000 then I have.

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Make no mistake, I shall sell it.

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£165,000 then to you, sir, once...

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£165,000 twice...

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£165,000 for the third and final time.

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That final successful bid of £165,000 was made by Ken.

0:19:280:19:35

I met up with him and his wife Tina at Plum Tree Cottage to find out more about their plans

0:19:350:19:40

for this property that they've just acquired for their portfolio.

0:19:400:19:43

-Congratulations.

-Thank you.

0:19:460:19:48

Now, this is not a typical house I would view on Homes Under The Hammer, I have to say.

0:19:480:19:53

How did you end up buying this, guys?

0:19:530:19:55

Well, I was playing golf.

0:19:550:19:57

I knew nothing. He just sort of came home and I said, "Had a nice day?" "Yes, I've bought a house."

0:19:570:20:02

-Over to you.

-So you'd been up to all sorts of mischief!

0:20:020:20:05

Yup, I had.

0:20:050:20:06

I was getting emails every day about distressed properties,

0:20:060:20:10

auction sales, that sort of thing,

0:20:100:20:12

and I was going through all the catalogues, and this one just stuck out at me.

0:20:120:20:16

So I consulted my partner, and we came and had a look at it,

0:20:160:20:19

and then got the information pack, the legal pack and that sort of thing,

0:20:190:20:23

gave it to our solicitors and they checked it over.

0:20:230:20:27

We've got partners, you see.

0:20:270:20:29

We have another couple and this is our pension plan.

0:20:290:20:33

-We began this, what...?

-In 1989.

0:20:330:20:36

Quite a while ago. And it was at that time when houses were so cheap.

0:20:360:20:40

Our first two-up, two-down was 47?

0:20:400:20:43

47. Something in that order, yes.

0:20:430:20:46

And we didn't take the rent, and the rent paid for the mortgage

0:20:460:20:49

or the loan, and we just gradually sort of built up our portfolio.

0:20:490:20:53

Now they've added Plum Tree Cottage to the other eight rental properties that they own.

0:20:540:20:58

Ken used to be a poultry farmer and Tina ran a company

0:21:000:21:03

providing garments for burn victims,

0:21:030:21:06

but then she got stuck into life on the farm.

0:21:060:21:09

Well, I came...

0:21:100:21:12

You know, I was a sort of secretary sort of background,

0:21:120:21:15

and then I met Woody and, suddenly, there I am harvesting eggs and chickens and things.

0:21:150:21:21

This is confusing me because you keep making reference to your husband as Woody.

0:21:210:21:25

Oh, yes. Yes, well, everybody calls him Ken except me.

0:21:250:21:28

It goes back to... I mean, Woody...

0:21:280:21:31

Well, he said, "Come and meet my parents,"

0:21:310:21:34

and off I went to meet his parents, and they all said, "Hello, John."

0:21:340:21:38

And it turns out that both his father and he are using their second names so they're both called Ken.

0:21:380:21:43

-But his real name's John?

-But his real name's John.

0:21:430:21:46

-But you call him Woody.

-Every time I said "Ken", his father would say "yes?",

0:21:460:21:51

and I just wanted to stop that confusion so I called him Woody.

0:21:510:21:54

Right. Thank goodness that's all cleared up, then.

0:21:540:21:58

So Ken...sorry, Woody and Tina have given up

0:21:580:22:01

poultry farming to concentrate on...well, golf and work.

0:22:010:22:05

So how long ago did you retire, guys?

0:22:080:22:10

-Ohh...

-Three years ago.

-Three years?

0:22:100:22:12

-Has he not stopped working?

-No, these properties keep him busy.

0:22:120:22:15

We were supposed to play golf together.

0:22:150:22:18

He said, "Learn to golf so we can do it in our retirement."

0:22:180:22:21

-And there you are, playing golf...

-I'm playing golf with all the girls and he's working.

0:22:210:22:26

Sneaking off buying houses!

0:22:260:22:27

Sounds a fair way to make their pension pot grow, though.

0:22:270:22:32

It looks a pretty good bargain at £165,000 for a brand-new house that's never been lived in.

0:22:340:22:41

Ken, I know this house was on the market last year for £285,000, no takers.

0:22:430:22:48

You've bought it for a lot less.

0:22:480:22:51

Why do you think that is?

0:22:510:22:53

I think they overpriced it. I think they were being a little bit greedy.

0:22:530:22:57

No-one bought it so they were forced, as the market dropped, to auction it.

0:22:570:23:01

And we were lucky to pick it up for that money.

0:23:010:23:03

Now, I've heard a rumour that there was a proposed pub going to be built next door.

0:23:030:23:09

Do you think that would've put would-be buyers off?

0:23:090:23:12

There was a pub next door originally and it was burnt down.

0:23:120:23:15

A 16th-century little old pub and it got burnt down, and there's been five years

0:23:150:23:19

of controversy cos they want it rebuilt,

0:23:190:23:21

but the council have finally decided that's not going to happen.

0:23:210:23:25

It's going to be housing.

0:23:250:23:27

Maybe it was concern about the neighbouring property

0:23:270:23:30

that put other investors off, but Tina's confident that it's no longer an issue.

0:23:300:23:34

With no work required, they've planned their own quick marketing campaign.

0:23:340:23:41

I mean, this is ready to go. Have you marketed this at all?

0:23:410:23:44

It's going in the paper tomorrow.

0:23:440:23:46

-For rent or for sale?

-For rent.

0:23:460:23:48

-So do you guys set up all the interviews?

-Mmm.

0:23:480:23:51

One every 20 minutes is the ideal.

0:23:510:23:54

-1 in, 1 out.

-Yeah.

-We know what we're looking for.

0:23:540:23:56

How much do you think you're looking to market this for?

0:23:560:24:00

The agent gave us a good idea that, in this area, it should go for £800-£850,

0:24:000:24:04

and we've seen others go for that sort of money in the area

0:24:040:24:09

in previous weeks, while we've been waiting to complete.

0:24:090:24:12

We've had a look at them.

0:24:120:24:14

Some are older, a bit bigger, but nothing of this quality.

0:24:140:24:19

No surprise, really, because this is a show-home finish, perfect to move straight into.

0:24:190:24:25

This is a question I always ask people on Homes Under The Hammer. What's your budget?

0:24:270:24:31

Basically, it's almost nothing.

0:24:310:24:33

I mean, I used to make all the curtains so that would be, for here, probably £100

0:24:330:24:38

or so for the materials, but now I buy them all because I'm retired. So it's cost about £350.

0:24:380:24:44

So your budget is just the curtains, isn't it?

0:24:440:24:47

-Yeah, nothing else.

-Nothing else.

0:24:470:24:48

-Carpet's beautiful.

-The garden?

0:24:480:24:51

-No.

-No, no. The tenants can make up their own minds what they would like to do to the garden.

0:24:510:24:56

So £350, that's it.

0:24:560:24:58

-That's it.

-Done.

0:24:580:25:00

And maybe dusted, because there's nothing else to do.

0:25:000:25:04

Ken and Tina have made a fantastic purchase here.

0:25:040:25:08

They've bought at a depressed time in the market

0:25:080:25:11

and their rental income will cover their mortgage.

0:25:110:25:14

I think it's a great low-maintenance property to add to their portfolio,

0:25:140:25:18

but the question is - can Tina drag herself away from the golf course long enough

0:25:180:25:22

to secure some tenants for this house?

0:25:220:25:24

You can find out what happens later on in the show.

0:25:240:25:28

Coming up, with these cracks, getting a loan

0:25:280:25:31

for this Staffordshire property won't be easy.

0:25:310:25:34

Because the mortgage company would basically say, "No."

0:25:340:25:38

We return to Wiltshire where there's been a bit of a battle.

0:25:380:25:43

There's a rental war on at the moment, and I felt certain

0:25:430:25:46

we would rent the house as long as people came and looked at it.

0:25:460:25:49

But first, in Lancashire, size isn't everything.

0:25:490:25:53

It's not massive by any stretch of the imagination,

0:25:530:25:56

but there is a bit of space in there.

0:25:560:25:58

We're back in Preston, where Phil paid £23,000 for this first-floor flat.

0:26:000:26:06

It had been guided at a very intriguing £10,000,

0:26:060:26:10

but a lot of buyers were put off because of an issue with the outside rendering of the block

0:26:100:26:16

and a potential extra bill of 9,000 quid.

0:26:160:26:19

But sensibly, Phil, who owns a construction company, did his homework and discovered

0:26:190:26:23

the matter had been resolved, Now, two months later, we're back to see what's been achieved.

0:26:230:26:29

Well, the first impression you now get as you walk into the hallway is of a modern, light flat.

0:26:330:26:39

New hard-wearing carpet's been laid and the living room decorated,

0:26:390:26:43

using the chocolate and beige sections of the colour charts.

0:26:430:26:47

That dated sliding door to the kitchen has been removed.

0:26:470:26:52

The bedroom feels much more spacious.

0:26:520:26:55

I reckon that's thanks to the colour scheme as well as the fact the wardrobe's been removed.

0:26:550:27:00

But where will the clothes go?

0:27:010:27:04

So who's been busy here? Is it all down to Phil?

0:27:040:27:07

All the work throughout the property has actually been carried out by the lads who work for me.

0:27:080:27:13

I visited two or three times a week to keep an eye on what they're doing,

0:27:130:27:17

but all the work has been carried out by my own employees.

0:27:170:27:20

# They call me mellow yellow... #

0:27:200:27:23

In the kitchen, we've taken it back to bare plaster.

0:27:240:27:28

We've put nice light units in, nice light tiles, we've made the most of the small space that we possibly can.

0:27:280:27:34

We've integrated the fridges, we've integrated the washing machines, we've put in a nice ceramic hob

0:27:340:27:40

and a nice-quality oven with an extractor above,

0:27:400:27:42

and I think we've made the best of the small space that we possibly can.

0:27:420:27:46

It feels a lot bigger than what it is, and it's a nice, workable kitchen.

0:27:460:27:50

The narrow, galley-style kitchen works fine here,

0:27:500:27:53

and Phil's concentrated on the two main areas in any property - the kitchen and bathroom.

0:27:530:27:59

We've completely ripped out the bathroom, gone back to plasterboard,

0:27:590:28:04

we've put white tiles on two elevations and a new white suite.

0:28:040:28:07

We've introduced an electric shower that it didn't have.

0:28:070:28:11

We've changed the extractor from the noisy one that we had,

0:28:110:28:14

and we've basically just left it clean and nice, neat lines.

0:28:140:28:17

Remember, Phil paid £23,000 for the flat and had set himself a budget of around £7,000.

0:28:170:28:24

Did he manage to stick to it?

0:28:240:28:27

The budget for the whole renovation was £7,000 ceiling.

0:28:270:28:31

We were going to be disappointed if we spent more than £6,000,

0:28:310:28:34

but we've actually spent £50 more than the £6,000,

0:28:340:28:37

but we've come in considerably less than the £7,000.

0:28:370:28:40

So I'm more than happy with what we've spent.

0:28:400:28:42

Yes, £950 under budget on a flat that cost just £23,000.

0:28:420:28:50

We've had the electrician test all the electrics,

0:28:500:28:53

we put in a wired-in smoke alarm system

0:28:530:28:55

and generally just checked over the electrics.

0:28:550:28:58

We've also taken out a storage heater which was protruding into the walkway,

0:28:580:29:02

so we've taken that out and put in a modern panel heater.

0:29:020:29:05

In the walk-through corridor, there is actually two wardrobes,

0:29:050:29:09

so we're going to utilise one of those for the wardrobe for the bedroom now.

0:29:090:29:13

So there is somewhere to hang clothes after all.

0:29:130:29:16

I wonder Phil had unearthed any more issues about the maintenance charges

0:29:160:29:20

for the block that had scared away other bidders on auction day.

0:29:200:29:24

The legal issues and the service charge that was on the properties

0:29:240:29:27

that was in the legal pack has been no issue at all.

0:29:270:29:30

We've done our homework, everything's been fine, not a problem at all.

0:29:300:29:34

The service charge for this year has been estimated at £1200,

0:29:340:29:38

so it's a couple of hundred pounds more than last year,

0:29:380:29:41

but we're still quite happy with that.

0:29:410:29:44

Remember, Phil had a tenant in the pipeline, so is his plan still to rent for a year or two?

0:29:440:29:51

Our original intention was to rent the flat for at least a couple of years.

0:29:510:29:55

We've got a tenant that's due to move in next week.

0:29:550:29:58

We've not actually signed him up cos we are toying with the idea

0:29:580:30:01

of selling to get some cash back and hopefully get some more.

0:30:010:30:04

Let's see how much two local estate agents will value the flat at.

0:30:060:30:09

It could alter Phil's game plan.

0:30:090:30:12

It's been very nicely decorated, certainly nice neutral colours,

0:30:150:30:19

and the proportions of the flat are very nice indeed.

0:30:190:30:22

Good choice of colour of bathroom and kitchen, all very neutral, new carpets.

0:30:220:30:27

I like the way they've taken the wardrobes

0:30:270:30:30

out of the master bedroom to give it a feel of space.

0:30:300:30:34

Oh, it's excellent.

0:30:340:30:36

I particularly like the kitchen in the flat

0:30:360:30:38

which I think has been done to a very nice standard and is in fact also well proportioned.

0:30:380:30:42

The standard of finish is pretty good.

0:30:420:30:45

I think somebody will move in and, because it's done to a nice standard,

0:30:450:30:49

will look after it.

0:30:490:30:50

Clearly, Phil's at a crossroads - will he rent or sell?

0:30:500:30:54

Let's investigate the financial merits of each.

0:30:540:30:58

I would suggest a rental value of approximately £325 per calendar month.

0:30:580:31:03

This property would rent currently for £375 per calendar month.

0:31:030:31:08

The two figures are either side of where we expected it to be.

0:31:080:31:11

We were expecting 350 and that's the figure we've agreed with the tenant,

0:31:110:31:15

so more than happy with both of those.

0:31:150:31:17

OK, renting's not ruled out. But how much could the flat now sell for?

0:31:170:31:22

Remember, Phil spent £29,050 buying and renovating it.

0:31:220:31:28

In the current market, I would suggest an asking price of £28,950

0:31:300:31:34

and I'm sure they'd get a lot of interest at that price.

0:31:340:31:38

I think the resale price of this property, in the current market, would be in the region of £40,000.

0:31:380:31:43

Some difference.

0:31:430:31:45

So either pretty much breaking even or a nice £10,000-£11,000 profit.

0:31:450:31:51

Well, the first value seems a lot lower than what we're expecting

0:31:510:31:54

and I'm sure we'll sell it for a lot more than that.

0:31:540:31:57

We've already had an agent of our own out

0:31:570:31:59

who's sort of around the second figure,

0:31:590:32:01

so we're expecting between 40 and 45.

0:32:010:32:03

I'd be very happy if we can make that sort of profit in a month's work.

0:32:030:32:07

So is the flat likely to be sold now?

0:32:070:32:11

I'd consider selling at 40,000, definitely.

0:32:110:32:14

Phil could well be on the lookout for more properties,

0:32:140:32:18

but what about the person he'd lined up for the place?

0:32:180:32:21

I will look for another property quickly for the tenant that we had for this one.

0:32:210:32:25

We've looked at lots of properties, but I think the one-bedroom flats, if we can make a good return

0:32:250:32:31

like it looks like we're going to on this one,

0:32:310:32:33

we will look at one-bedroom smaller stuff, especially in the current climate.

0:32:330:32:37

And judging from this purchase, I'm sure Phil will do his homework thoroughly again.

0:32:370:32:42

Staffordshire is often thought of in terms of its towns,

0:32:460:32:51

such as Stoke-on-Trent, but don't forget it's got fantastic countryside too.

0:32:510:32:56

So this is Brown Lees in Staffordshire, and surrounded by beautiful countryside it is...

0:32:560:33:02

he says in a Yoda from Star Wars kind of way.

0:33:020:33:05

Well, this is what I'm here to see. It's a two-bedroom mid-terrace at a guide price of 50,000 quid.

0:33:050:33:11

The question is - will the force be with whoever buys it?

0:33:110:33:14

MUSIC: "Star Wars Main Theme" by John Williams

0:33:140:33:16

Well, it might not be light years off a busy road, but it is set back far enough back not to be an issue

0:33:160:33:22

and, with these country views, this terrace has more going for it than most.

0:33:220:33:27

But on closer inspection, I can't help getting a bit of a sinking feeling.

0:33:270:33:31

Looking along this row of houses, I think I've managed to come to one of the worst.

0:33:310:33:36

Oh, well, onwards and upwards.

0:33:360:33:39

So what surprises are in store?

0:33:410:33:44

Well, fairly standard sort of front living room area here.

0:33:440:33:49

Fireplace - I don't know, I like that. 1920s probably.

0:33:490:33:52

But if you get rid of the thing on the front, the gas fire,

0:33:520:33:55

if that was an open fire I think that's actually quite pretty.

0:33:550:33:58

However, that isn't.

0:33:580:34:01

Look at that crack. Absolutely horrendous,

0:34:010:34:05

so we're going to be on the lookout for more indications of subsidence as we go through the house.

0:34:050:34:10

Through here into the rear sitting room, again not a bad-sized space.

0:34:100:34:13

Another open fire there, which is really lovely, and then here you go - classic design.

0:34:130:34:18

Through to the kitchen, very small

0:34:180:34:20

it needs to be sorted out, then on into the bathroom.

0:34:200:34:23

Now, not ideal but I think, in this kind of property, you expect it.

0:34:230:34:28

It's those cracks that are really worrying me.

0:34:280:34:30

Dirty bathrooms I can handle, poky kitchens can be fixed, and jungle wallpaper can be tamed,

0:34:300:34:38

but the plaster's falling off in the back room

0:34:380:34:40

and the outside space is a real mess.

0:34:400:34:44

# It's unbelievably hard to love you but I love you anyway... #

0:34:440:34:49

The kitchen and bathroom extension's almost falling down

0:34:490:34:53

and there are more signs of damp and, from out here,

0:34:530:34:56

the upstairs doesn't look much better.

0:34:560:34:59

So, upstairs, a fairly standard layout.

0:34:590:35:02

You've got two good-sized bedrooms, one at the back there and then another one at the front.

0:35:020:35:07

But, when you come up here, more indications of some really serious problems in this property.

0:35:070:35:13

Look at that. I can actually put my fingers inside that crack there.

0:35:130:35:16

Obviously, the house has serious subsidence.

0:35:160:35:20

That is an issue in itself, especially when it comes to getting a mortgage,

0:35:200:35:24

because the mortgage company would basically say, "No".

0:35:240:35:27

This house was guided at £50,000, and that crack looks like a graph plotting the fall in its value.

0:35:300:35:38

Apart from the cracks in the back bedroom, there are also signs

0:35:390:35:42

of worrying neglect in the plumbing department.

0:35:420:35:46

And, just when I thought it couldn't get any worse,

0:35:480:35:50

a local property expert has unearthed some more news

0:35:500:35:53

about this particular railway cottage.

0:35:530:35:56

It is a mining area.

0:35:560:35:58

The properties were actually built for the miners, not for the railway,

0:35:580:36:02

so there is sort of a history behind that there.

0:36:020:36:05

And where there are mines, there are big holes in the ground,

0:36:050:36:08

which do tend to make cracks appear in the houses.

0:36:080:36:11

A mining report is a must, and any buyer should also dig deeper.

0:36:110:36:16

It's not going to be for somebody to take light-heartedly.

0:36:170:36:20

Get a structural survey done. If you're worried at all

0:36:200:36:23

regarding any of the cracks or the structure, I would advise you to instruct a surveyor.

0:36:230:36:28

How much would that report cost?

0:36:280:36:31

It depends what level survey you go in for.

0:36:310:36:33

You could be looking at a couple of hundred pounds.

0:36:330:36:36

That would be money well spent for any investor brave enough to take on this cottage.

0:36:360:36:43

When it comes to the cost of general renovation, I don't think there's any need for a big budget.

0:36:430:36:50

It's a good location.

0:36:500:36:51

With it being an entry-level property, I think you could go

0:36:510:36:56

for the basics, really. A bathroom, kitchen, it needs replastering,

0:36:560:37:00

I just think to give it a good clean look.

0:37:000:37:02

It's certainly going to take a fair bit of elbow grease but, as it's most likely

0:37:020:37:07

to attract first-time buyers, there's no need for gold taps here.

0:37:070:37:11

But could you be looking at a gold-plated return for a buy-to-let investor?

0:37:110:37:15

With it being only two bedrooms, obviously I don't think it would be a family property.

0:37:150:37:20

I think, to be realistic, 425-450 per calendar month.

0:37:200:37:23

I don't think that would be too difficult.

0:37:230:37:26

It's a good location to buy as well - quiet, semi-rural.

0:37:260:37:30

I don't think you'd have a problem selling.

0:37:300:37:32

That could generate anywhere between £95,000 and £100,000.

0:37:320:37:38

But an investor should tread carefully when it comes to renovation costs.

0:37:380:37:42

So a nice enough property in a pleasant location, but those real issues with cracks and subsidence

0:37:440:37:51

means that this isn't something that you should take on lightly.

0:37:510:37:55

You are going to probably have to buy it with cash and set aside quite a wodge of money to sort it out.

0:37:550:38:01

Yes, it's going to take more than a Jedi Knight to fix this one.

0:38:010:38:05

Let's go to the auction.

0:38:050:38:07

Lot number 22 is 64 Railway Cottages, Brown Lees.

0:38:070:38:12

This is a house in need of complete modernising and updating.

0:38:120:38:16

Gardens to the front and a yard to the rear. Lot number 22.

0:38:160:38:22

Can we say 40 to start? Who'll give me 40 to start it?

0:38:220:38:26

40 I'm bid, thank you. £40,000 standing.

0:38:260:38:29

At £40,000, 45 can I say?

0:38:290:38:32

45, thank you. At £45,000... 50 is it?

0:38:320:38:38

Want to go one? You do, £46,000.

0:38:380:38:43

At £46,000. 47, one to you, sir? 47.

0:38:430:38:48

48? 48.

0:38:480:38:50

49.

0:38:500:38:52

50.

0:38:520:38:54

At £50,000... 51 can I say?

0:38:540:38:58

At £50,000.

0:38:580:39:00

Right, are we all done?

0:39:000:39:03

At 50 for the first time...

0:39:030:39:04

At 50 for the second time, third and final time at 50... Are we all done?

0:39:040:39:11

-You bought it. Well done.

-The new owners of this

0:39:130:39:15

cracked cottage above a disused mine are Harold and his wife Sue.

0:39:150:39:20

They're part-time property developers and already have several rental properties in the area.

0:39:200:39:25

This run-down terrace seemed to be just what they were looking for.

0:39:250:39:30

Sue, Harold, nice to meet you both. Congratulations.

0:39:300:39:32

So why take on a project that needs a lot of work rather than one that doesn't?

0:39:320:39:38

I think it's location, really.

0:39:380:39:40

-Yes.

-There were...

-You wouldn't get this now...

0:39:400:39:43

We've looked at new houses and you don't get this openness.

0:39:430:39:48

We know, with having the country walk where the railway line's been,

0:39:480:39:52

nobody's likely to build there, and it is a beautiful location, isn't it? It's really nice.

0:39:520:39:58

So it does have quite a lot of history, doesn't it?

0:39:580:40:01

Well, they were built, I believe, late 1800s,

0:40:010:40:05

probably by Robert Heath who owned the mines, and they were called Railway Cottages

0:40:050:40:12

because the railway ran just outside.

0:40:120:40:15

It's quite a pleasant walk now. If you like to keep fit,

0:40:150:40:18

you can get on a bike and I believe it goes for quite a number of miles now

0:40:180:40:22

in either direction.

0:40:220:40:23

Location was key to the purchase.

0:40:230:40:25

My concern is that renovating that house won't be freewheeling for Sue and Harold.

0:40:250:40:31

OK, so let's talk about the house, then.

0:40:310:40:34

There are some very serious cracks.

0:40:340:40:36

-What do you know about them?

-They're big cracks, yeah.

0:40:360:40:39

Um...it's all to do with the mining, I think, settling.

0:40:390:40:45

I've had an engineer in to have look at it

0:40:450:40:48

and it's the sort of thing you would expect in this area, although it does need putting right.

0:40:480:40:56

Probably underpinning one of the walls and new concrete floors need to be put in.

0:40:560:41:00

Underpinning and new floors are a big capital outlay

0:41:000:41:05

on top of all the general renovation required here.

0:41:050:41:09

Getting the house back on a sure footing is vital so it could get a mortgage in the future because,

0:41:090:41:14

whilst they were cash buyers, the next purchasers may not be.

0:41:140:41:18

Yeah, that is one of the problems.

0:41:180:41:20

You have to... If you wish to sell the property on,

0:41:200:41:24

you have to correct all the structural defects,

0:41:240:41:28

and it wants a damp coursing as well of course.

0:41:280:41:32

OK, so give me an idea of how much you've set aside to do all the work.

0:41:320:41:36

Original estimate was about maybe 15,000, 16,000, but I feel sure that will go to 20,000.

0:41:360:41:44

OK, Sue, talk me through what you're going to do inside the house.

0:41:440:41:47

Well, we've got quite a few ideas.

0:41:470:41:50

The good thing about this property is the fact that it is run-down and needs modernising.

0:41:500:41:57

It means that we can, you know, put a lot of ideas in, so it's toying with what we really do.

0:41:570:42:04

We want to maybe have an inglenook fireplace in the front room, make that more of the living area.

0:42:040:42:10

Possibly, this will be the kitchen area where we want to keep a little bit of the character,

0:42:100:42:17

probably a countrified, fresh kitchen, but not lose too much of the character.

0:42:170:42:23

So what kind of experience do you have in the property world?

0:42:230:42:26

Over the years,

0:42:260:42:28

we've done one or two properties.

0:42:280:42:31

We started with some garages, a row of garages that we accidentally acquired.

0:42:310:42:38

Accidentally?!

0:42:380:42:40

We were selling our house and the guy who was buying the house was

0:42:400:42:45

a few thousand short, so he put the garages in.

0:42:450:42:49

And, eventually, we built two semi-detached houses on there.

0:42:510:42:55

Since then, we've bought a church, an abattoir and a small mill.

0:42:550:43:03

And did what with a church, an abattoir and a small mill?

0:43:030:43:07

The church is a factory, the abattoir is a factory now. We're turning that into a factory.

0:43:070:43:13

And the mill they're just knocking down to make way for a new supermarket.

0:43:130:43:19

By the sounds of it, these two are certainly up for the challenge of this little terrace.

0:43:190:43:24

It IS in a pretty bad state, with some very large cracks.

0:43:240:43:29

They plan to let it out once renovated, but then what?

0:43:290:43:34

Well, the long-term plan, really, is to...

0:43:340:43:37

We are getting to the age now where we're looking forward to retirement

0:43:370:43:42

and the rental of the properties

0:43:420:43:45

we're hoping will pay for our retirement.

0:43:450:43:48

It is charming, just a little bit rough around the edges.

0:43:480:43:51

You're being kind there!

0:43:510:43:53

Well, I certainly hope this house above an old mine won't be a rough diamond for too much longer.

0:43:540:44:01

Well, Harold and Sue clearly love this place, and quite rightly so.

0:44:010:44:06

They are aware of the cracks and the money it's going to cost

0:44:060:44:09

to put them right, so they're going into this with their eyes open.

0:44:090:44:13

However, I'm worried about the amount they're going to have to spend to put this place right,

0:44:130:44:18

and how much it will be worth when they've done all that hard work.

0:44:180:44:22

Shouldn't they have just bought somewhere that didn't need any of this?

0:44:220:44:26

Oh, well, you can find out how they get on later in the show.

0:44:260:44:29

Well, we've given them time to do the work, but has the work been done?

0:44:320:44:36

Will we return to bare plaster or a perfect finish? Let's find out.

0:44:360:44:41

Back in the Wiltshire village of Redlynch, retired couple Ken and his wife Tina paid £165,000

0:44:430:44:49

for this year-old house that had never been lived in.

0:44:490:44:52

They were going to add it to their portfolio of other buy-to-let properties

0:44:520:44:56

which they manage with another couple, but it came out of the blue for golfer Tina.

0:44:560:45:00

-He said, "Learn to play golf so we can do it in our retirement."

-And there you are, playing golf...

0:45:030:45:08

-I'm playing golf with all the girls and he's working.

-Buying houses!

0:45:080:45:12

There was nothing to do but pop up some curtains and advertise for tenants.

0:45:130:45:18

So I guess it's little surprise that, six weeks later,

0:45:200:45:24

the place is let and the new occupants' belongings have turned it into a home.

0:45:240:45:29

What a great find it must have been for the family,

0:45:290:45:32

as they're the first occupants of this house,

0:45:320:45:35

and getting it at the auction was pretty good news for Ken as well.

0:45:350:45:40

This house was obviously very attractive to us because we had no work to do, hardly at all.

0:45:400:45:46

In an older house, you tend to get all these little niggly problems which I go and have to sort out -

0:45:460:45:51

showers leaking and that sort of thing - so I prefer to have something as new as this.

0:45:510:45:58

So it was only the curtains to hang, a job Tina had done many times

0:45:580:46:02

before in their other properties, but this time there was a problem.

0:46:020:46:07

I had all these curtains to hang, and Woody brought me a stepladder

0:46:070:46:12

and it's not one I'm normally used to.

0:46:120:46:14

Most stepladders have a step and this one didn't.

0:46:140:46:17

It had some hooks or something.

0:46:170:46:19

So I just opened it, climbed up and it collapsed underneath me and I fell to the floor.

0:46:190:46:25

And I thought I'd landed really well.

0:46:250:46:27

I usually do a parachute roll but I must've had my hand underneath me

0:46:270:46:31

and I broke it about there.

0:46:310:46:32

Ooh, ouch! That meant Tina had to get Ken to put up the curtains.

0:46:320:46:37

I hope he checked the dodgy ladder.

0:46:370:46:39

Then the simple refurbishment took another turn for the worse.

0:46:390:46:43

We thought, when we bought this house, that all we'd have to actually do is hang up the curtains,

0:46:440:46:50

but we discovered after a little while that all the woodwork had only been primed and not top-coated.

0:46:500:46:56

So, with a friendly painter we know who's retired,

0:46:560:47:01

he did most of the painting

0:47:010:47:03

and I did the taking off the door handles and things like that to make the job easier.

0:47:030:47:09

Well, this threw the budget into turmoil.

0:47:090:47:12

Yes, they paid just 165,000 for the new house,

0:47:120:47:16

but now the gloss paint had taken the costs to £600.

0:47:160:47:20

There also had to be an ad in the local paper.

0:47:200:47:25

It took two weeks to find the tenants.

0:47:250:47:27

We put the advert in, I think my husband put it in at 795

0:47:270:47:31

and we actually rented it out two weeks later for 750.

0:47:310:47:37

From their experience of other buy-to-lets, they knew their ideal tenants.

0:47:370:47:41

The type of people we like to choose, if we've got that much choice,

0:47:410:47:48

is professional couples ideally, both working, because you've got two incomes to pay for one rent.

0:47:480:47:55

So who have they let Plum Cottage to?

0:47:550:47:58

It's a nice little couple.

0:47:580:48:00

Mother lives in the village so they were very keen to have it,

0:48:000:48:04

and two nice little children, so they'll be good tenants.

0:48:040:48:07

It's time for two local estate agents to have a look.

0:48:090:48:12

Should they have considered furnishing the house

0:48:120:48:15

before renting it out?

0:48:150:48:16

In my experience, the majority of tenants will have quite a bit

0:48:170:48:21

of their own furniture and items,

0:48:210:48:23

so we find letting properties unfurnished is more popular.

0:48:230:48:26

There is the odd tenant but the exception rather than the rule.

0:48:260:48:29

My experience of the rental market in this area,

0:48:290:48:33

properties rent better unfurnished and it's obviously worked well

0:48:330:48:38

for the owners because they've managed to rent the property.

0:48:380:48:41

The sitting room's got lots of light with the full-length windows doors across the back onto the deck -

0:48:410:48:47

very good. The kitchen is not the biggest.

0:48:470:48:49

The bedrooms, again, are limited in part.

0:48:490:48:54

My advice to the owners of the property would be definitely to hang onto it

0:48:540:48:59

for the long term, for the market to rebuild.

0:48:590:49:01

Could that affect the rental income? How much should they be charging?

0:49:020:49:06

I'm not sure what the owners are currently getting from their tenants,

0:49:060:49:11

but I would look to achieve around £800 per calendar month.

0:49:110:49:15

We'd recommend a rental to £750 to £775 per calendar month.

0:49:150:49:22

We started at 800 and dropped to 750.

0:49:220:49:24

-I thought 750 was...

-So we're in the right ball park, aren't we?

0:49:240:49:28

Of course, getting tenants in so quickly is just what they required to generate income immediately.

0:49:280:49:34

In its current state, I would look to value the property at between £175,000 and £185,000.

0:49:340:49:41

We'd recommend a value in the region of £185,000 to £190,000.

0:49:410:49:46

Well, £185,000 would be £20,000 more than they paid at auction.

0:49:460:49:52

Even allowing for the paint and curtains, that's not bad.

0:49:520:49:56

Ah, well, it's a profit on there, then.

0:49:560:49:59

So Ken's purchase could end up all it was cracked up to be,

0:49:590:50:03

but more importantly, when will Tina be back on the golf course?

0:50:030:50:09

The plaster comes off tomorrow.

0:50:090:50:11

11.25 I go to the fracture clinic and I would quite like to be on the fairway,

0:50:110:50:17

doing at least a little putting and chipping, by tomorrow afternoon.

0:50:170:50:21

Well, that could leave Ken free to find more properties to add to their pension pot.

0:50:230:50:27

We're heading back to Staffordshire now.

0:50:320:50:35

Were those gaping cracks in this mid-terrace the tell-tale signs

0:50:350:50:38

of subsidence that that Harold and his wife Sue suspected?

0:50:380:50:41

They paid £50,000 for the house.

0:50:410:50:45

They intended to renovate it in a country-cottage style and then rent it out.

0:50:450:50:49

Five months later, we've returned.

0:50:520:50:54

OK, the front garden is certainly a lot tidier,

0:50:540:50:56

but the main transformation is round the back.

0:50:560:50:59

The old yard has been paved over

0:51:010:51:03

and they've managed to create a parking space.

0:51:030:51:06

Inside, the front living room now has a new floor

0:51:060:51:10

and the cracked walls have been replastered.

0:51:100:51:13

And there's also been a major change in the back room.

0:51:130:51:17

Just as Sue promised,

0:51:170:51:18

they've created a fabulous country-style kitchen-diner.

0:51:180:51:22

The original kitchen is now a laundry room

0:51:220:51:24

with a refitted bathroom beyond it.

0:51:240:51:26

Upstairs, the cracks in the two bedrooms have been patched up.

0:51:300:51:34

Both are decorated, and there's even a bed in the front room.

0:51:340:51:37

It seems that Harold had been worrying unnecessarily about the possible subsidence.

0:51:390:51:44

I thought it was a bigger problem than what it was,

0:51:460:51:50

but we had some structural engineers in

0:51:500:51:52

and we managed to rectify all the cracks,

0:51:520:51:55

put a new concrete floor in, and it doesn't seem to be a problem at all.

0:51:550:52:01

It was quite a challenge, really, from the rough state it was in

0:52:010:52:06

to begin with, but it's been quite therapeutic in a way, really.

0:52:060:52:12

Quite pleased with the outcome.

0:52:120:52:14

Therapeutic for Susan, but it's been hard work for me.

0:52:140:52:18

I've been doing all the labouring.

0:52:180:52:20

Well, the hard graft has paid off.

0:52:200:52:23

Remember, Harold and Sue bought the house because of its location.

0:52:230:52:27

It overlooks a country park and a cycle route

0:52:270:52:29

that was once the railway the terrace is named after.

0:52:290:52:32

Well, we've changed this room completely round.

0:52:340:52:38

This was originally the, er...

0:52:380:52:40

I suppose you'd call it the lounge.

0:52:400:52:43

We made it into the kitchen-diner.

0:52:430:52:46

We've got a complete kitchen in, we've taken the whole fireplace out

0:52:460:52:50

and extract the fumes through what used to be the old chimney.

0:52:500:52:55

Generally speaking, it's worked out quite well.

0:52:550:52:58

I think there's enough room for a table in here, four chairs, and a useable kitchen area.

0:52:580:53:04

So the layout is basically the same.

0:53:040:53:08

It's just the rooms that have been rearranged.

0:53:080:53:10

We did think of having an inglenook fireplace

0:53:130:53:16

but we decided on this one,

0:53:160:53:19

which seems to fit it quite well and give it the country feel.

0:53:190:53:24

Also the laminate floors.

0:53:240:53:26

And it's been replastered which I think looks really good, really well.

0:53:260:53:31

And the curtains have been recycled.

0:53:310:53:33

They were from a cottage we had before.

0:53:330:53:36

Really opened it up really well.

0:53:360:53:38

Harold and Sue had toyed with putting the bathroom upstairs

0:53:380:53:42

but they decided to leave the two double bedrooms.

0:53:420:53:44

I think they could've made more of the bathroom.

0:53:440:53:47

I'm not sure they need such a big utility room.

0:53:470:53:51

They've still got a few jobs left.

0:53:510:53:53

There's painting to do and the front garden to finish.

0:53:530:53:56

And Sue's keen to get the flagstones in the kitchen back to a rich red colour.

0:53:560:54:01

So what has all this cost?

0:54:010:54:06

Um, we're up to about £14,500, with probably another 1,000 to go, so we're quite pleased.

0:54:060:54:13

I expected it to... We anticipated it going over budget

0:54:130:54:17

but we've put a few extras in and I don't think £15,500 is too bad, really.

0:54:170:54:23

Let's see if it was money well spent.

0:54:230:54:27

How will two local estate agents rate this refurbishment?

0:54:270:54:31

Those changes are fantastic.

0:54:330:54:34

I love how they've moved the kitchen

0:54:340:54:36

into the second reception room as it was.

0:54:360:54:38

I just think, as a whole, it brings the property together

0:54:380:54:41

as a more family home.

0:54:410:54:43

It's a nice property.

0:54:430:54:45

I don't know what it looked like in its original state,

0:54:450:54:48

but now it's been brought up to a nice standard.

0:54:480:54:51

Generally speaking, people do prefer the bathroom to be on the first floor, ideally, next to the bedrooms.

0:54:510:54:56

I don't think it matters too much.

0:54:560:54:57

With it being a cottage, it was unrealistic to move it upstairs

0:54:570:55:01

with it being just two double bedrooms.

0:55:010:55:03

A lot of people tend to be going down the road

0:55:040:55:06

of renting their properties out, just because of the economy at the moment, which is understandable,

0:55:060:55:12

so, yeah, as an investment it's a good rental property.

0:55:120:55:15

But just how good is good?

0:55:150:55:18

How much income could it generate?

0:55:180:55:20

I would say on a rental value of £450 per month.

0:55:200:55:25

I think if you're looking between 400, 425 per calendar month,

0:55:250:55:29

You'd be quite realistic to let it in a short period of time.

0:55:290:55:32

Mmm, that's good.

0:55:320:55:34

That's a good return.

0:55:340:55:35

Good return on the investment that is, yeah. Quite pleased with that.

0:55:350:55:39

Remember, they paid £50,000 for the house at auction and their budget

0:55:390:55:43

is heading towards £15,500,

0:55:430:55:45

so how much could the property now be worth?

0:55:450:55:50

I would market and value this property at £80,000.

0:55:500:55:53

I personally feel that they would achieve £100,000 to £110,000.

0:55:530:55:57

So at least £15,000 gross profit.

0:55:570:56:02

That works out well.

0:56:020:56:04

We're into a profit.

0:56:040:56:07

Even at the lower valuation, we're into a profit, so that's good.

0:56:070:56:11

Might those figures tempt them to sell and take a profit?

0:56:110:56:14

No, I think we'd stick with the renting. That was the plan.

0:56:140:56:18

It's nice to take a semi-derelict property

0:56:180:56:23

and turn it into a reasonably desirable property to live in.

0:56:230:56:28

Will they look for another challenging property to refurbish?

0:56:280:56:33

At the moment, we've been saying we're not going to do anything.

0:56:330:56:37

I don't think we'll do anything for a while.

0:56:370:56:39

If we saw the right type of property to renovate, we might have another try then.

0:56:390:56:46

But not for a while.

0:56:460:56:48

We're going to have a rest!

0:56:480:56:50

So we hope you've enjoyed the trials and tribulations of today's show.

0:56:530:56:57

-Join us next time for more Homes Under The Hammer.

-See you then.

-Goodbye.

0:56:570:57:02

For more information about Homes Under The Hammer,

0:57:020:57:05

including how the programme was made, visit the website at bbc.co.uk

0:57:050:57:10

Subtitles by Red Bee Media Ltd

0:57:190:57:22

E-mail [email protected]

0:57:220:57:25

Martin Roberts and Lucy Alexander visit a flat in Preston with a low guide price, a house in Wiltshire with a surprise and an old terraced house with a few cracks in Staffordshire.

All of these properties went to auction and Martin and Lucy find out who bought them and what they paid when they went under the hammer.


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