0:00:02 > 0:00:04You don't need experience to buy at a property auction.
0:00:04 > 0:00:07But you do have to do your research and have your finances in place.
0:00:07 > 0:00:12And have the courage to just put up your hand and bid for your home under the hammer.
0:00:37 > 0:00:41All sorts of properties make their way into the auction catalogues,
0:00:41 > 0:00:45from commercial premises to magnificent mansions and cosy cottages.
0:00:45 > 0:00:49Let's see what we found to feature on today's programme.
0:00:49 > 0:00:56There's a property in Wales that would keep you fit without going to the gym.
0:00:56 > 0:00:58What an incredible staircase. Very steep.
0:00:58 > 0:01:04I get absolutely plastered in London.
0:01:04 > 0:01:09The first thing you notice is that spectacular cornicing, that ceiling rose.
0:01:09 > 0:01:15And in Watford, if you're a wine connoisseur, this is the place for you.
0:01:15 > 0:01:17There's a massive cellar!
0:01:17 > 0:01:19Chateau Watford Gap here we come.
0:01:22 > 0:01:26All of these properties went to auction, and we'll find out who bought them and for how much
0:01:26 > 0:01:28when they went under the hammer.
0:01:36 > 0:01:38Today I'm in Barry, South Wales.
0:01:38 > 0:01:42Allegedly, Sir Billy Butlin got his idea for his holiday camps
0:01:42 > 0:01:45when he was staying in a bed-and-breakfast here.
0:01:45 > 0:01:51More recently, of course, it's been the setting for the hit BBC TV show Gavin And Stacey.
0:01:51 > 0:01:56The big question, of course, is when it comes to property, what's occurring?
0:02:01 > 0:02:05The property I'm here to see is just a short walk from the centre of Barry,
0:02:05 > 0:02:09so it gets a big tick in the location box. From the outside, it looks pretty good.
0:02:09 > 0:02:15Three-bedroom mid-terrace, guide price was £65,000.
0:02:15 > 0:02:21The roof and exterior walls are in good condition and there are new windows and doors.
0:02:21 > 0:02:24So far, this property is ringing my bell.
0:02:24 > 0:02:25DOORBELL CHIMES
0:02:25 > 0:02:28Lovely! An old fashioned doorbell. How marvellous!
0:02:28 > 0:02:31Wow! What an incredible staircase.
0:02:31 > 0:02:33Very steep, but also quite long.
0:02:33 > 0:02:37Not where you expect for a terraced house like this.
0:02:37 > 0:02:40But I suddenly see what advantage that brings.
0:02:40 > 0:02:42Look at the ceiling height in here.
0:02:42 > 0:02:44Absolutely fantastic.
0:02:44 > 0:02:48That immediately gives you a great sense of space.
0:02:48 > 0:02:49What's through here?
0:02:49 > 0:02:51They're a classic of their time, aren't they?
0:02:51 > 0:02:55What it does, it leads through into the rear sitting room.
0:02:55 > 0:02:59In here, you've got a loo and bathroom downstairs. Is it worth moving it upstairs?
0:02:59 > 0:03:01Don't know, you'd have to look into the costings carefully.
0:03:01 > 0:03:06Kitchen off the back there, but then... Look at this fireplace.
0:03:06 > 0:03:09It's a classic.
0:03:11 > 0:03:18Even using all their nine lives, this dated chimney doesn't stand a cat's chance of surviving.
0:03:19 > 0:03:21Upstairs there are three bedrooms.
0:03:21 > 0:03:26The new buyer would have the opportunity of converting one of the two smaller bedrooms
0:03:26 > 0:03:29into an upstairs bathroom.
0:03:29 > 0:03:35It would cost a bit, but it would be more in keeping with what people want these days.
0:03:38 > 0:03:42One thing I've noticed about this house, it's got a lot of mirrors.
0:03:42 > 0:03:45And right now, a lot of Martins, too.
0:03:50 > 0:03:54As I wanted to reflect on this property for a moment, I headed for the garden.
0:03:56 > 0:03:58At an auction guide price of just 65,000,
0:03:58 > 0:04:03I think this three-bedroom house could be fantastic value for money.
0:04:03 > 0:04:08Most of what needs doing is cosmetic, although there's some damp in the bathroom.
0:04:12 > 0:04:15There's also a very useful garage space where you could house
0:04:15 > 0:04:19your classic car, or just the clutter of everyday life.
0:04:19 > 0:04:23So far, I think this property is a winner, but just in case the sun and
0:04:23 > 0:04:28sea air have scrambled my senses, I invited a local estate agent round
0:04:28 > 0:04:30for a reality check.
0:04:34 > 0:04:37I think it's a good, sound, traditional
0:04:37 > 0:04:40three-bedroom, mid-terrace property.
0:04:40 > 0:04:47This house would need to have central heating, it probably would need to have the kitchen updated,
0:04:47 > 0:04:51and complete redecoration throughout, including carpets.
0:04:51 > 0:04:55I knew it. A bit of sun and sea, and I forget about the basic necessities
0:04:55 > 0:04:59like a proper, modern central heating system!
0:04:59 > 0:05:03New central heating will make a hefty dent in any renovation budget,
0:05:03 > 0:05:05as will moving the bathroom upstairs.
0:05:05 > 0:05:08And would that improvement really be worth it?
0:05:13 > 0:05:16My recommendation would be to leave it as it is,
0:05:16 > 0:05:19leave it as three bedrooms and leave the bathroom downstairs.
0:05:19 > 0:05:22There's a saving there at least.
0:05:22 > 0:05:29This house is in a great location in the town of Barry, with the train station just a short walk away.
0:05:29 > 0:05:31It's only a 20-minute car journey to Cardiff,
0:05:31 > 0:05:35so it's a property that will appeal to a wide variety of people.
0:05:35 > 0:05:40But is the guide price of 65,000 good value for money?
0:05:44 > 0:05:50Renovated, this property would probably go on the market for about £110,000.
0:05:50 > 0:05:55So there's a huge potential for sale profit, even after a modest renovation.
0:05:55 > 0:06:00But what about as a rental property?
0:06:00 > 0:06:04£595 per calendar month.
0:06:04 > 0:06:11That's a yield of at least 10% on the auction guide price, which makes it a mouth-watering opportunity.
0:06:14 > 0:06:20If you think that all properties that go to auction are smelly, damp places that are really in a state,
0:06:20 > 0:06:23here's something that proves that's not the case.
0:06:23 > 0:06:25A house that you could basically move into as it is.
0:06:25 > 0:06:29I'd be very careful about doing any kind of restorations on this.
0:06:29 > 0:06:31Moving the bathroom upstairs? Don't think it's worth it.
0:06:31 > 0:06:35I think it's just a smarten-up, possibly get rid of the fireplace,
0:06:35 > 0:06:37apart from that, it's ready to rock and roll.
0:06:37 > 0:06:39Let's see who bought it at the auction.
0:06:43 > 0:06:46On to lot number 19 now, ladies and gentlemen.
0:06:46 > 0:06:49Three-bedroom, mid-terrace house.
0:06:49 > 0:06:52I'm going to go in straight on my reserve.
0:06:52 > 0:06:57I have a proxy bid of £69,000.
0:06:57 > 0:07:02At £69,000. At £69,000. 70, thank you.
0:07:02 > 0:07:08At 70,000, at 70,000. My proxy bid is at 71.
0:07:08 > 0:07:15At £71,000 for the proxy bid, at 71. 72 in the back.
0:07:15 > 0:07:18Yeah, OK. That's 73 then, thank you.
0:07:18 > 0:07:20At 73, the proxy bidder is out.
0:07:20 > 0:07:22You're out in the middle.
0:07:22 > 0:07:2674, at 74. 75, please, sir. I can see you.
0:07:26 > 0:07:33At 75, at 75. 76. 76. Against you, sir, at 76.
0:07:33 > 0:07:3877 can I? 77 I'm bid. At 77, against you standing in the back.
0:07:38 > 0:07:45Your bid at 77,000. At £77,000, hold your catalogue up again.
0:07:45 > 0:07:47At £77,000. There is my bid.
0:07:47 > 0:07:49The gentleman in the blue open-necked shirt.
0:07:49 > 0:07:54At 78,000, a half if you like. A half quickly.
0:07:54 > 0:07:57At £78,000, the hammer's up and it's your bid, sir.
0:07:57 > 0:08:02Make no mistake, you're out behind, are we all done?
0:08:02 > 0:08:04At £78,000, a half quickly if you like.
0:08:04 > 0:08:08At £78,000,
0:08:08 > 0:08:10it's yours, sir. Thank you very much.
0:08:10 > 0:08:12And the winning bidder is Ian.
0:08:12 > 0:08:17He's a local businessman who's still relatively new to the auction rooms.
0:08:21 > 0:08:24He bought it for £78,000.
0:08:24 > 0:08:29That's a good price, so he needn't fear that he's been taken for a ride.
0:08:29 > 0:08:32Mind you, he knows all about that sort of thing already.
0:08:35 > 0:08:40# Welcome to the pleasure dome... #
0:08:40 > 0:08:45- Barry Island Pleasure Park. - What about it?- Well, I own Barry Island pleasure park.- Oh, wow!
0:08:45 > 0:08:47How cool is that? Tell me about the pleasure park.
0:08:47 > 0:08:49Does it have roller coasters and big wheels?
0:08:49 > 0:08:52Yes, there's roller coasters on there. It's quite a good park.
0:08:52 > 0:08:54Or it has been in its day.
0:08:54 > 0:08:58But we need to redevelop it and get it under cover.
0:08:58 > 0:09:01That's like the ultimate boy's toy, to own a pleasure park.
0:09:01 > 0:09:05Do you have all your mates round when it's all closed?
0:09:05 > 0:09:06You go and ride the roller coasters and stuff?
0:09:06 > 0:09:10I have done in the past, but...
0:09:11 > 0:09:16- ..not these days, no.- How long have you owned it for?- About 15 years.
0:09:16 > 0:09:20So from owning a pleasure park to property, why did you want to buy this place?
0:09:20 > 0:09:23- I've got five daughters, but I've got two left at home.- Right.
0:09:23 > 0:09:29They'll be coming of age in the next couple of years,
0:09:29 > 0:09:33so I think the time to get into the buy-to-let market is now.
0:09:33 > 0:09:38- I've been visiting a few auctions recently, watching your programme... - Great!
0:09:38 > 0:09:40..and this one came up.
0:09:40 > 0:09:44Rent it for a couple of years, then move the kids straight in.
0:09:44 > 0:09:46Get them out of the house into their own?
0:09:46 > 0:09:48- Yes. - Are they happy to stay in the area?
0:09:48 > 0:09:50Yeah, they like Barry.
0:09:50 > 0:09:52So why this particular property?
0:09:52 > 0:09:55I looked at four on the day that were in the auction,
0:09:55 > 0:09:59and out of the four that I looked at, this was the one that I wanted.
0:09:59 > 0:10:04I was just in the right place at the right time, if you like.
0:10:04 > 0:10:11I'm very pleasantly surprised with how clean the property was when I walked through the door.
0:10:11 > 0:10:13So tell me what you're going to do to it.
0:10:13 > 0:10:19I think we're going to put central heating in, and, to be honest,
0:10:19 > 0:10:23we're going to take down some of the wall, make this into a bigger living room.
0:10:23 > 0:10:25So take down this dividing wall here?
0:10:25 > 0:10:28Yeah. Get more light into it.
0:10:28 > 0:10:33And obviously just decorate all the way through - change the wallpaper,
0:10:33 > 0:10:35take down a bit of this lovely wood.
0:10:35 > 0:10:40- And the fireplace? - And the fireplace has got to go! We have got a home for the cats.
0:10:40 > 0:10:46- You have?- One of my daughters likes cats, she's not seen that yet.
0:10:46 > 0:10:51You've got one more daughter to sort out - after that, are you going to build a portfolio, or is it purely
0:10:51 > 0:10:54driven by the fact that you're buying them for your daughters?
0:10:54 > 0:10:56No, it's not purely for the daughters -
0:10:56 > 0:10:59it's something that I've been looking to get into for quite some time.
0:10:59 > 0:11:03There's a few deals out there at the moment, interest rates
0:11:03 > 0:11:06are very low, as we know - now's the time to buy the property.
0:11:06 > 0:11:10If you can afford to sit on them for three, five years,
0:11:10 > 0:11:12I think you'll be on an earner.
0:11:15 > 0:11:21If, like Ian, you've got the cash, investing in buy-to-let can seem a great idea at the moment.
0:11:21 > 0:11:24But who knows what might happen in the future.
0:11:24 > 0:11:28It could be as bumpy a ride as one of his fairground attractions.
0:11:29 > 0:11:35- So tell me how much you're going to spend.- I think I'll be looking at around 10...10K.
0:11:35 > 0:11:37What about timescale?
0:11:37 > 0:11:41As quickly as possible. If I just go the renovation route,
0:11:41 > 0:11:44I'll be looking at 12 weeks, on and off.
0:11:44 > 0:11:47Thank you very much, good luck. I hope it all turns out well.
0:11:47 > 0:11:49Maybe I'll see you down at the pleasure park.
0:11:49 > 0:11:51No problem, you can always have a free band.
0:11:51 > 0:11:54Really? Very kind of you, I'm off!
0:11:56 > 0:12:00# ..Roller coaster Just got to ride it... #
0:12:00 > 0:12:04I often say that property developing is a bit like a roller-coaster ride,
0:12:04 > 0:12:07so Ian should be prepared for what might happen.
0:12:07 > 0:12:10The big question, of course, is potential problems.
0:12:10 > 0:12:13Will he "dodgem", or "waltzer" round them?
0:12:13 > 0:12:17One thing for sure, he won't be "carou-selling" the property,
0:12:17 > 0:12:19because it's going to go to his daughters.
0:12:19 > 0:12:25I'm going to go back into my pun cave now - you can find out what happens later in the show.
0:12:27 > 0:12:32# Oh, the times They are a changing... #
0:12:32 > 0:12:39I'm in Lewisham, south-east London, to visit a Victorian property where time has not stood still.
0:12:42 > 0:12:46For many years, Lewisham was a popular suburb of London, and these homes would have been built
0:12:46 > 0:12:52for the wealthy, drawn here by improved transport links and the fresh air.
0:12:52 > 0:13:00In fact, according to the 1911 census, this property here was occupied by a family of just four.
0:13:00 > 0:13:02Today, the houses have nearly all been subdivided, and we're here
0:13:02 > 0:13:08to see a one-bedroomed flat on the raised ground floor of this semi-detached house.
0:13:08 > 0:13:12It had a guide price of just 120,000 quid.
0:13:14 > 0:13:20'Even with the current housing recession, 120,000 for a London flat sounds a good deal.'
0:13:22 > 0:13:25That communal area is a little bit disappointing.
0:13:25 > 0:13:29On the inside, it's a bit tired.
0:13:29 > 0:13:35But...wow! When you walk into this room, the first thing you notice
0:13:35 > 0:13:40is that spectacular cornicing, that ceiling rose. That's actually taken my breath away.
0:13:40 > 0:13:45You've got this big, big, voluminous room, high ceilings, this magnificent window area.
0:13:45 > 0:13:51Look at this. Originally, this house would have had great big shutters either side.
0:13:51 > 0:13:55To reinstate those would be amazing. This is a bit of a worry.
0:13:55 > 0:13:58Not quite sure what it is, maybe a bit of a damp problem,
0:13:58 > 0:14:02could be to do with something outside - the guttering, perhaps.
0:14:02 > 0:14:04I'd certainly get that looked at.
0:14:04 > 0:14:06And when you walk into the middle of the room,
0:14:06 > 0:14:10that is your focal point - you've got a big chimney breast there.
0:14:10 > 0:14:13I'd like to see a nice, big old fireplace reinstated.
0:14:13 > 0:14:15I think that would look amazing. But you know what?
0:14:15 > 0:14:19It's fantastic, isn't it? I love it.
0:14:19 > 0:14:21# Bring me a higher love
0:14:23 > 0:14:25# Bring me a higher love... #
0:14:25 > 0:14:28For those of you who love high ceilings and elaborate plasterwork
0:14:28 > 0:14:32as much as I do, this flat is pure heaven.
0:14:32 > 0:14:35In the bedroom next door, the beautiful cornicing continues.
0:14:35 > 0:14:37This room and next door's kitchen would originally have
0:14:37 > 0:14:42been just one space, and the ceiling shows how it used to be.
0:14:45 > 0:14:50The current decoration is not the most modern of colour schemes, but that can easily be changed,
0:14:50 > 0:14:53and there's a lovely big window through which
0:14:53 > 0:14:57Victorian courting couples would've exchanged love notes.
0:14:58 > 0:15:04Compared to all the rooms in this flat, this one is the most disappointing.
0:15:04 > 0:15:06It's really small in here and it's the kitchen.
0:15:06 > 0:15:09Straightaway I can see it's just a bad layout.
0:15:09 > 0:15:12I'd like to reorganise this space.
0:15:12 > 0:15:15The boiler looks as though it may need replacing.
0:15:15 > 0:15:21I don't think you could get a table and chairs in here, it'd be on the tight side, but you know what?
0:15:21 > 0:15:25All you need to do is look at that window. It's beautiful.
0:15:30 > 0:15:32Sadly the term "bathing beauty"
0:15:32 > 0:15:36can't be used to describe the bathroom. This room single-handedly
0:15:36 > 0:15:39destroys all my notions of romantic Victorians.
0:15:39 > 0:15:46Instead of lavender water, I'm getting more of a "post-match muddy rugby player" vibe.
0:15:46 > 0:15:48I think it's time for some air.
0:15:50 > 0:15:56When you buy a flat, it's up to you to make the most of the inside, but what about the exterior?
0:15:56 > 0:16:01That's often up to the freeholder, and I'd certainly be asking a few questions here.
0:16:01 > 0:16:04First up - this, the rear garden.
0:16:04 > 0:16:08Now, I'm aware it's shared between all the units, and it's a jungle
0:16:08 > 0:16:11when it could be invaluable outside space.
0:16:11 > 0:16:15I think it's outrageous, but why isn't it being maintained?
0:16:15 > 0:16:19More alarmingly, the scaffolding. What's it doing there?!
0:16:19 > 0:16:24Is there a leaky roof? Are they investigating a structural issue?
0:16:24 > 0:16:26If there's a problem, then it's the leaseholders
0:16:26 > 0:16:30who will have to fork out if the service charge doesn't cover it.
0:16:30 > 0:16:33So when you're viewing property keep calm, use your eyes and ask
0:16:33 > 0:16:38questions, or you could end up with an expensive mistake on your hands.
0:16:40 > 0:16:43Vegetation apart, I'm still very impressed
0:16:43 > 0:16:47with this one-bedroom flat, especially at that guide price of 120,000.
0:16:49 > 0:16:52I asked a local estate agent to tell me more about the property
0:16:52 > 0:16:53and the surrounding area.
0:16:56 > 0:17:00This road is mainly made up of Victorian properties.
0:17:00 > 0:17:02There are some big semi-detached
0:17:02 > 0:17:05and detached houses on one side of the road.
0:17:05 > 0:17:07It's got a very nice park across the road.
0:17:07 > 0:17:10The nearest station is eight minutes' walk away.
0:17:11 > 0:17:15It ticks all the boxes so far, but inside the flat there were
0:17:15 > 0:17:19lots of things that needed attention. So how much would a renovation cost?
0:17:20 > 0:17:24You wouldn't need to spend much more than 10, 12,000 on it.
0:17:24 > 0:17:28Once renovated, how much could it go for?
0:17:28 > 0:17:31You'd probably be talking somewhere around 185.
0:17:32 > 0:17:39So for a total investment of around 130,000, you could be making 55 grand profit.
0:17:39 > 0:17:43Is the rental potential just as tempting?
0:17:43 > 0:17:47This property could achieve per calendar month £750 - £800.
0:17:47 > 0:17:54That would give a rental yield of at least seven per cent, based on the guide price and renovation costs.
0:17:57 > 0:18:02I think this flat is a little beauty. It's got charm and bags of character.
0:18:02 > 0:18:05I'd certainly be doing some research into the freeholder situation
0:18:05 > 0:18:11but as an investment or for a young first-time buyer, I think it's a fabulous lot.
0:18:11 > 0:18:13Let's find out who went for it at auction.
0:18:17 > 0:18:19It's a one-bedroom flat, needs modernisation.
0:18:19 > 0:18:23Who'd like to give me a start on this? 100?
0:18:23 > 0:18:25Bidding at the back? Thank you, 100 I've got.
0:18:25 > 0:18:28Might be their lucky day.
0:18:28 > 0:18:30100 for the first.
0:18:30 > 0:18:35100 for the second. How much? 105? OK, 101.
0:18:35 > 0:18:37102. 103.
0:18:37 > 0:18:40104.
0:18:40 > 0:18:42105. 106.
0:18:42 > 0:18:46107. 108.
0:18:46 > 0:18:49109. 110. 111.
0:18:49 > 0:18:53112. 113. 114.
0:18:53 > 0:18:57115. 116.
0:18:57 > 0:19:02117. 118. 119. 120.
0:19:02 > 0:19:05121.
0:19:05 > 0:19:11122. 123. 124.
0:19:11 > 0:19:17Have a think about it, it's with the lady here in the middle. £123,000 against you at the back.
0:19:17 > 0:19:20Anybody else for Lot 85?
0:19:20 > 0:19:23124 back in.
0:19:23 > 0:19:26125. OK, 125. 126.
0:19:26 > 0:19:29127. 128.
0:19:29 > 0:19:31129.
0:19:31 > 0:19:32130. 131.
0:19:32 > 0:19:39One more? Have a think about it. It's with the lady in the middle. Anybody else?
0:19:39 > 0:19:44130 for the first, 130 for the second.
0:19:44 > 0:19:47130 for the third and final time. Are we all done?
0:19:47 > 0:19:49Well done.
0:19:49 > 0:19:53The winning bidder is Jo, seen here with her husband.
0:19:56 > 0:20:01She's a beginner at property investing but has lived in the area for the last 16 years.
0:20:04 > 0:20:08In fact, the flat she's bought is only two streets away from her home.
0:20:08 > 0:20:11That's handy since she'll be doing most of the work.
0:20:11 > 0:20:15Her stockbroker husband-cum-business partner is going to be taking
0:20:15 > 0:20:20a hands-off approach to the wallpaper stripping and decorating.
0:20:20 > 0:20:22# I've nothing much to offer
0:20:26 > 0:20:29# I'm an absolute beginner. #
0:20:33 > 0:20:36Jo, congratulations. You look so happy about this purchase.
0:20:36 > 0:20:38- I am, I'm excited.- Are you?- I am.
0:20:38 > 0:20:44But looking around coming back for the third time, the flat's in a state.
0:20:44 > 0:20:46It's a lot worse than I thought it was.
0:20:46 > 0:20:47I know it's just cosmetics but...
0:20:47 > 0:20:50- I'm excited. - How do you feel about the price?
0:20:50 > 0:20:54Do you feel you may have paid over the top for it or is it a bargain?
0:20:54 > 0:20:57I thought maybe it was a bit on the expensive side and then I spoke to
0:20:57 > 0:21:00someone who said, "No, it's a good price."
0:21:00 > 0:21:03Although it needs some work doing to it, it's a good price.
0:21:03 > 0:21:05So what are you doing buying property in this climate?
0:21:05 > 0:21:10A lot of people aren't out there buying property, they're a bit worried about what's going on.
0:21:10 > 0:21:11They're waiting to see.
0:21:11 > 0:21:19Initially we were thinking that we may let my brother have it, but then it worked out he works too far away
0:21:19 > 0:21:24so it worked out, let's just buy it anyway and rent it out, so we're going to rent it out.
0:21:24 > 0:21:27- What was it about the flat that you liked so much?- The coving.
0:21:27 > 0:21:32- THEY LAUGH - It's gorgeous! - The coving and the location,
0:21:32 > 0:21:36and because we're so close to home, so now that we've decided to rent it out,
0:21:36 > 0:21:43it's close if there are any issues and it's close to London by train, London by DLR.
0:21:43 > 0:21:44The DLR station is down the road.
0:21:44 > 0:21:48So how on top of this project are you going to be? Are you working at the moment?
0:21:48 > 0:21:53No. I resigned from my job, not because we were thinking about buying a flat,
0:21:53 > 0:21:57but just because I was unhappy at work so I spoke to my husband.
0:21:57 > 0:21:59He said, "If it's making you that unhappy then resign".
0:21:59 > 0:22:03Then this happened and I love decorating, so as of next Monday,
0:22:03 > 0:22:07I'm going to be in here cleaning and decorating, so my husband's getting free labour!
0:22:07 > 0:22:11There you are in the recession, resigning, become a property developer.
0:22:11 > 0:22:13You're about to put you overalls on!
0:22:13 > 0:22:15I'm helping Gordon Brown!
0:22:16 > 0:22:20# I've got work to do I've got work, baby
0:22:20 > 0:22:23# Got work to do... #
0:22:23 > 0:22:27I think for the living room and the bedroom it's just cosmetics,
0:22:27 > 0:22:33it's just going to need paint, new radiators, a good clean and we may put in some false fireplaces
0:22:33 > 0:22:39so the rooms have got focal points and the kitchen and bathroom, need a new kitchen and bathroom.
0:22:39 > 0:22:42Do you think you may have inherited any problems with it?
0:22:42 > 0:22:44Looking around yesterday, maybe.
0:22:44 > 0:22:48On the basis that if you look at the back garden and the communal areas,
0:22:48 > 0:22:51it doesn't look like they're looked after.
0:22:51 > 0:22:56Another thing that straight away sets alarm bells ringing in my ears is the scaffolding on the side.
0:22:56 > 0:22:58What's that for?
0:22:58 > 0:23:04When my husband and I came to look at it, we did think maybe it was one of the flats were having something done,
0:23:04 > 0:23:10but we decided very late in the day that we were gonna buy so we didn't have time to have a survey done.
0:23:10 > 0:23:12Let's keep our fingers crossed on that one.
0:23:13 > 0:23:18One of the down-sides of buying at auction is that as the purchasing process is so speedy,
0:23:18 > 0:23:24it's not always possible for buyers to check all relevant facts before bidding
0:23:24 > 0:23:26so it's very much a case of buyer beware.
0:23:26 > 0:23:31Still, on the positive front, there is still a lot of potential in this flat.
0:23:33 > 0:23:38It's a travesty that you've got a London flat and nobody's using
0:23:38 > 0:23:41that huge outside space that you've got there.
0:23:41 > 0:23:43If, when we get round to sorting it out,
0:23:43 > 0:23:48I think it will make a lovely addition to whomever wants to rent the flat.
0:23:48 > 0:23:52- I hadn't realised how big the garden was.- It goes right the way back.
0:23:52 > 0:23:56If you look at the house two along, you can see the sections of the garden.
0:23:56 > 0:23:58Each flat has got a really big section,
0:23:58 > 0:24:03so you've got all of that to think about but that's more than just an overhaul.
0:24:03 > 0:24:06- That really is a good few weeks' work.- And a lot of money.
0:24:06 > 0:24:08What sort of budget are you looking at for the work?
0:24:08 > 0:24:14Initially we were saying 10,000 but hopefully half that.
0:24:14 > 0:24:18Have you ever done anything like this before? Is this the first time for you?
0:24:18 > 0:24:21- No, first time.- Tell me your timescale for the work.
0:24:21 > 0:24:22- A month.- Is that realistic?
0:24:22 > 0:24:25Who knows? I don't know.
0:24:29 > 0:24:34So it's a very brave move to quit your job and buy property in a recession.
0:24:34 > 0:24:40I think Jo's got a great flat here for a good price but she's got some serious investigating to do
0:24:40 > 0:24:46and I reckon, get this garden sorted out and a good buy turns into a fantastic purchase.
0:24:47 > 0:24:54Coming up - in Watford, Cupid's shot his arrow and it's true romance.
0:24:54 > 0:24:56I love this flat.
0:24:58 > 0:25:02In London, there's a new recruit to the army of white van drivers.
0:25:02 > 0:25:06I hired a white van and I drove all the way up to Wolverhampton on my own.
0:25:06 > 0:25:09It was brilliant, it was like a mini adventure.
0:25:09 > 0:25:11But first, back to Ian.
0:25:11 > 0:25:13Has he finally got his daughters out of his house?
0:25:13 > 0:25:17They haven't come down and seen it. I don't think they're interested.
0:25:21 > 0:25:24We're returning to the Welsh seaside town of Barry
0:25:24 > 0:25:29to see how local businessman Ian is doing with the three-bedroomed house
0:25:29 > 0:25:31he bought at auction for 78,000.
0:25:31 > 0:25:38He purchased it as both a buy-to-let investment and a starter home for one of his five daughters.
0:25:38 > 0:25:42We all know property investing can be a helter-skelter experience,
0:25:42 > 0:25:46but Ian might be better equipped than most of us to handle that.
0:25:51 > 0:25:53- Barry Island Pleasure Park. - What about it?
0:25:53 > 0:25:56Well, I own Barry Island Pleasure Park.
0:25:56 > 0:25:58Oh, wow. How cool is that? Tell me about the pleasure park.
0:25:58 > 0:26:00Roller coasters, big wheels?
0:26:00 > 0:26:03Yeah, there's a roller coaster on there. It's quite a good park.
0:26:03 > 0:26:08# Life is a roller coaster Just gotta ride it... #
0:26:08 > 0:26:10Ian is relatively new to property investment.
0:26:10 > 0:26:14So, how will he have done with the renovation?
0:26:14 > 0:26:19Let's find out when we return four months later.
0:26:19 > 0:26:23When we first met Ian, he was planning to do up the property
0:26:23 > 0:26:27and probably rent it out until his daughter was ready to take it on.
0:26:27 > 0:26:30Inside, it all looked really good.
0:26:34 > 0:26:41It all appears homely and ready to be lived in. In fact, hold on... It seems very lived-in.
0:26:45 > 0:26:51What's happened, I had big intentions of turning the whole property around.
0:26:51 > 0:26:57In actual fact, because of the Barry Island Pleasure Park, I'd been so involved with getting
0:26:57 > 0:27:03that sorted out for the season that I really didn't have any time to deal with the property myself.
0:27:03 > 0:27:11So really, in a nutshell, as it happens, a friend of mine was looking for a house.
0:27:11 > 0:27:15I was in the pub and I said, "How's your daughter and son-in-law getting on?"
0:27:15 > 0:27:17They said, "Oh, they're living with us.
0:27:17 > 0:27:21"They're looking for a property, but they can't find one."
0:27:21 > 0:27:25I said, "As it happens, I've got a property.
0:27:25 > 0:27:28"There's a deal to be done if you're interested, if you want to get them out your hair."
0:27:28 > 0:27:34It's ironic that Ian, who bought the property so he could get one of his own daughters out of his hair
0:27:34 > 0:27:39and living elsewhere, should be helping a friend to do the same.
0:27:39 > 0:27:42But it's been a godsend for his three new tenants -
0:27:42 > 0:27:47Natasha, Gareth and their four-month-old baby boy, Harley.
0:27:47 > 0:27:51They're now thoroughly enjoying their independent family life,
0:27:51 > 0:27:53but did have to make a contribution.
0:27:55 > 0:27:58They had a deal on the rental of the property.
0:27:58 > 0:28:02But, in turn, they did the interior decorating.
0:28:02 > 0:28:07Because they were going to live in the property, I thought they might as well put it to their liking.
0:28:09 > 0:28:13So, all the renovation was done and paid for by Natasha and Gareth.
0:28:13 > 0:28:16And it looks like they've done a great job.
0:28:18 > 0:28:26OK, in one of the bedrooms upstairs, the new decor can't be said to appeal to a wide variety of people.
0:28:26 > 0:28:29But Junior likes it, so who cares?
0:28:31 > 0:28:36This is the first time I've seen the property since the new tenants moved in.
0:28:36 > 0:28:39I'm pleasantly surprised with what they've done, to be honest.
0:28:39 > 0:28:46The chimney breast was probably the...baddest thing about the property.
0:28:46 > 0:28:49But they've taken that out,
0:28:49 > 0:28:52and it's looking all right. One of the reasons why I was
0:28:52 > 0:28:57very happy to have bought this property was the actual kitchen.
0:28:57 > 0:29:00As you can see, it's scrubbed up really well.
0:29:00 > 0:29:05And I don't think, to be honest, that there's anything new in here.
0:29:05 > 0:29:08It just looks so clean and tidy.
0:29:08 > 0:29:11Yeah, very, very good. Very, very pleased.
0:29:16 > 0:29:21Financially, it's worked out very well for me, apart from the central heating, that I've paid for.
0:29:21 > 0:29:25They're just going to rent the property now for the foreseeable future.
0:29:25 > 0:29:32I'm quite happy for the next few years just to sit on the property until my daughter comes of age.
0:29:34 > 0:29:38The last area that needs looking at is the garden.
0:29:38 > 0:29:45Again, the tenants have done good work, but it's here the landlord Ian has laid down one small condition.
0:29:47 > 0:29:49I had some potatoes at home.
0:29:49 > 0:29:55The deal was they could have the property as long as they plant the potatoes and I have half the crop.
0:29:55 > 0:29:57They've actually done that in the garden.
0:29:57 > 0:30:01I can't see any shoots at the moment, but they've taken the greenhouse
0:30:01 > 0:30:04down and they've put the little patio there.
0:30:04 > 0:30:07Yeah, it's looking quite smart.
0:30:07 > 0:30:10Talking about small potatoes, Ian's renovation must have come in
0:30:10 > 0:30:15well under budget, because he saved on materials and trades people.
0:30:17 > 0:30:22My budget so far has been around...
0:30:22 > 0:30:244K, really.
0:30:24 > 0:30:29This raises the question of whether Ian has made a profit on his property investment.
0:30:29 > 0:30:33The best people to answer this are two local estate agents.
0:30:41 > 0:30:46What do they think of Ian's renovation, courtesy of Natasha and Gareth?
0:30:54 > 0:30:58The property has transformed quite considerably, to be honest.
0:30:58 > 0:31:00In particular the bathroom.
0:31:00 > 0:31:03The kitchen is absolutely superb. People love white kitchens.
0:31:03 > 0:31:08I don't believe this property needed a higher standard of improvement.
0:31:08 > 0:31:11What has been done has been very simple, but very straightforward.
0:31:11 > 0:31:12A good reaction, there.
0:31:12 > 0:31:16But what effect will it have on the current price?
0:31:16 > 0:31:20- It's yours, sir. Thank you very much. - Ian bought the property for 78,000,
0:31:20 > 0:31:23plus the usual costs and expenses.
0:31:23 > 0:31:27With his tenants' help, he's only spent £4,000 on the renovation,
0:31:27 > 0:31:31making a grand total of around £82,000.
0:31:31 > 0:31:35How much do the estate agents think it's now worth?
0:31:35 > 0:31:3790,000 to 95,000.
0:31:37 > 0:31:40Round about 92,000, as an asking price.
0:31:40 > 0:31:47So, that's a pre-tax profit of at least £8,000, and Ian is happy.
0:31:47 > 0:31:50There's a little bit of a profit there from day one.
0:31:50 > 0:31:53It's only going to get better as time goes by.
0:31:53 > 0:31:57Of course, for Ian, this house is a long-term investment.
0:31:57 > 0:32:02He's planning on renting it out as well as letting it to one of his daughters in the future.
0:32:02 > 0:32:06So, how much could it make as a rental property?
0:32:06 > 0:32:10Between £550 and £575 per calendar month.
0:32:10 > 0:32:12550 per calendar month.
0:32:12 > 0:32:16I knew it was around 550, 575.
0:32:16 > 0:32:19So, the tenants that are in here I'm very happy with.
0:32:19 > 0:32:21They've had a deal, and I'm happy.
0:32:21 > 0:32:27One thing that I have noticed about getting into the property game is you do need time.
0:32:27 > 0:32:30And I'm already working eight days a week!
0:32:30 > 0:32:33But, yeah, as and when the opportunities come up, properties
0:32:33 > 0:32:38around the right money, I'll get the deposit together and keep purchasing.
0:32:42 > 0:32:46I'm just south of Watford in Oxhey, where there's a lot
0:32:46 > 0:32:49that was up for auction that seemed to suit all needs.
0:32:49 > 0:32:57Ground-floor shop, two-bedroom maisonette and office space, all had a guide price for 290,000 quid.
0:32:57 > 0:32:58Now, if you're thinking, "Oh, how terribly convenient.
0:32:58 > 0:33:02"I'll run the shop, I'll live in the maisonette and I'll work from the office."
0:33:02 > 0:33:05You can't. Cos the shop's already got a ten-year lease on it.
0:33:05 > 0:33:08But let's look round the rest of the property.
0:33:08 > 0:33:14'The flat and the office can be found through this pretty courtyard, complete with parking space.
0:33:14 > 0:33:17'So far, everything's looking neat and tidy.'
0:33:20 > 0:33:24It's a pretty impressive start, I have to say. The stairway there, totally renovated.
0:33:24 > 0:33:28And...wow, look at this!
0:33:28 > 0:33:31I feel like I've been catapulted forward in time by three months,
0:33:31 > 0:33:34like the property has already been refurbished. It's beautiful!
0:33:34 > 0:33:40Look at this bathroom! Nice towel rail, nice fittings. Gorgeous!
0:33:40 > 0:33:41New paint everywhere.
0:33:41 > 0:33:48Wow! Look at this kitchen! I love the high ceilings. Very trendy units.
0:33:48 > 0:33:50It's got a marble work surface.
0:33:50 > 0:33:54Absolutely fantastic. What a start!
0:33:54 > 0:33:58I have to say, this is one of the best-maintained auction properties
0:33:58 > 0:34:01I've ever seen on Homes Under the Hammer.
0:34:04 > 0:34:06Everything just reeks of quality.
0:34:06 > 0:34:12There are two spacious bedrooms, both of them complete with a walk-in wardrobes.
0:34:17 > 0:34:23And another welcome surprise - there's a shower room, complete with basin and WC.
0:34:23 > 0:34:26Two bathrooms is very much what buyers or renters want these days,
0:34:26 > 0:34:30so I can see this place being an instant hit.
0:34:33 > 0:34:34And it gets better.
0:34:34 > 0:34:39I would not have anticipated this, looking at this flat from the outside.
0:34:39 > 0:34:42What a room! Look at this window!
0:34:42 > 0:34:45I mean, it's a shame it's not looking out across the Serengeti.
0:34:45 > 0:34:47But it's still fantastic.
0:34:47 > 0:34:52A beautiful, big, light, airy space. I love this flat.
0:34:52 > 0:34:57And it doesn't stop there. For that £290,000 guide price,
0:34:57 > 0:35:00you also get two other valuable assets.
0:35:00 > 0:35:03And the first one is directly beneath the shop.
0:35:07 > 0:35:10Well, so far, perfect project for an armchair investor.
0:35:10 > 0:35:14But down here, there is a massive cellar.
0:35:14 > 0:35:17Look. So this is a chance for you to get your hands dirty.
0:35:17 > 0:35:21Great news - it's got no damp and this wonderful ceiling height.
0:35:21 > 0:35:26So I would be looking at converting this into a bedroom, perhaps, maybe a games room.
0:35:26 > 0:35:28The opportunities are endless.
0:35:28 > 0:35:30And in terms of investment, money you spend on here will
0:35:30 > 0:35:33easily be returned on the value of the property.
0:35:33 > 0:35:40That leaves one final piece in the jigsaw - last but not least, it's this!
0:35:40 > 0:35:43This little office is a real bonus to the whole offering.
0:35:43 > 0:35:48It's not huge, but you're not gonna believe the amount you could get in rent for it.
0:35:48 > 0:35:49Let me just tell you what it is first.
0:35:49 > 0:35:53You've got a little kitchen area there and a loo. And then this one area.
0:35:53 > 0:35:56The thing is, there's a shortage of this kind of small office space in this area.
0:35:56 > 0:36:01So believe it or not, you could get £400 a month for this place alone.
0:36:01 > 0:36:04Wow! Added bonus!
0:36:04 > 0:36:05So there you have it.
0:36:05 > 0:36:10A shop which will produce an income for the next 10 years.
0:36:10 > 0:36:14A superb two-bedroomed flat, a very handy cellar space,
0:36:14 > 0:36:21and a self-contained office, all for a guide price of £290,000.
0:36:21 > 0:36:27It's an absolute bargain. Oh, and I forgot to mention, there's some handy car parking space as well.
0:36:27 > 0:36:31All I need to know now is a bit about the area.
0:36:31 > 0:36:34So I asked a local estate agent to tell me more.
0:36:37 > 0:36:40We're actually in Oxhey Village, which is a suburb of Watford.
0:36:40 > 0:36:42It's a very popular area.
0:36:42 > 0:36:44It's mainly Victorian housing.
0:36:44 > 0:36:48People would want to live here because of access to the railway station. It's very convenient
0:36:48 > 0:36:51for the motorway. And it's a nice place to live.
0:36:51 > 0:36:56That's great news. Now I have to say, this two-bedroom flat is in immaculate condition.
0:36:56 > 0:36:58So, why is that?
0:37:00 > 0:37:03The owner was living in the flat, which is why it's got
0:37:03 > 0:37:08a much better standard than you might expect to see on a normal auction property.
0:37:08 > 0:37:13With this property, there's very little to renovate, just the office and possibly the cellar.
0:37:13 > 0:37:16Would renovating the latter make good financial sense?
0:37:19 > 0:37:22I'd value the flat at £200,000.
0:37:22 > 0:37:29If the cellar is converted, potentially, you're looking at £235,000 for the whole thing.
0:37:29 > 0:37:33That's a potential gain of £35,000.
0:37:33 > 0:37:37But to renovate the cellar would be expensive, with problems of tanking and airflow.
0:37:37 > 0:37:40Still, everything else suggests
0:37:40 > 0:37:44that if the price is right, buying this property would be very good business.
0:37:47 > 0:37:51The shop at the moment is producing £11,500 a year.
0:37:51 > 0:37:57The flat will rent for at least £1,000 a month, so that's another £12,000 a year.
0:37:57 > 0:38:02If the office is converted, that ought to produce about £100 a week.
0:38:02 > 0:38:04So that's an extra £5,000.
0:38:04 > 0:38:09Those rental figures would produce a yield of nearly 10% on the auction guide price.
0:38:09 > 0:38:13And it gets better still.
0:38:13 > 0:38:17Based on current mortgage rates, I think that the shop income would probably pay the mortgage
0:38:17 > 0:38:21for the whole property. It's a fantastic return.
0:38:21 > 0:38:26Well, there's one phrase that springs to mind with this one, and that's no-brainer.
0:38:26 > 0:38:28You've got the shop that's already rented out,
0:38:28 > 0:38:33this maisonette which is beautiful, doesn't need any work. You've got the added potential of the office.
0:38:33 > 0:38:37And then, for the future, convert the cellar, and add even more value.
0:38:37 > 0:38:41It really is a fantastic opportunity. Let's see who's spotted it at the auction.
0:38:44 > 0:38:47Would you start me maybe at 250 on this one?
0:38:47 > 0:38:50At 250 somewhere? 250?
0:38:50 > 0:38:53Thank you, sir. Straight in at 250. At 260?
0:38:53 > 0:38:55Thank you very much, sir. 260.
0:38:55 > 0:38:58270 may I say? Yes, 270. 280, then?
0:38:58 > 0:39:01275, then? 275. 280.
0:39:01 > 0:39:05280. 285? Yes? 285.
0:39:05 > 0:39:10290, then? No. OK, it's 285,000.
0:39:10 > 0:39:15290, I'll take it there. Gentleman over there. Three people bidding, to my left-hand side,
0:39:15 > 0:39:18standing by the door at the back. In the market now at £290,000.
0:39:18 > 0:39:22291. 292? 292. 293.
0:39:22 > 0:39:27293. 294? 294. 295? 295.
0:39:27 > 0:39:31296? 296. 297?
0:39:31 > 0:39:33You can't say no!
0:39:33 > 0:39:36So, at £296,000... 297? Have a think about it.
0:39:36 > 0:39:37297?
0:39:37 > 0:39:42296-and-a-half? OK, then. So, £296,000 at the back of the room.
0:39:42 > 0:39:47296-and-a-half anywhere else? Otherwise we're selling at £296,000.
0:39:47 > 0:39:52I'm keeping my eye on you. But I'm selling to you. So, £296,000, for the first time,
0:39:52 > 0:39:55for the second time... 296-and-a-half. 297?
0:39:58 > 0:40:02They're discussing it. Exciting. 297? 297.
0:40:02 > 0:40:04297-and-a-half? He says no this time.
0:40:04 > 0:40:10I'll keep my eye on you, in case you come back. So £297,000, to the two gentlemen standing at the back,
0:40:10 > 0:40:11for the first time, second time,
0:40:11 > 0:40:16and the third and final time, at £297,000. Sold. Well done, thank you very much.
0:40:16 > 0:40:18Thank you to the under bidder, there.
0:40:18 > 0:40:21But who is the mysterious buyer at the back?
0:40:24 > 0:40:29His name is Tony, and he's a 27-year-old local to the area.
0:40:31 > 0:40:34Now, what's with the dramatic music, you may be wondering?
0:40:34 > 0:40:40Well, it turns out that Tony has an exciting, globe-trotting job, which you'll find out about later.
0:40:43 > 0:40:46Tony, congratulations. This is a great property, isn't it?
0:40:46 > 0:40:47Yeah, really excited with it.
0:40:47 > 0:40:49I didn't expect to get it really at the auction.
0:40:49 > 0:40:52It was more of a case of just going along to have a look. No, it's brilliant. Really happy with it.
0:40:52 > 0:40:55What did you know of the property before you bought it?
0:40:55 > 0:40:59Quite a bit. Basically my brother lives just through that wall.
0:40:59 > 0:41:02- Really?!- I'd actually just come back from a job.
0:41:02 > 0:41:08I work abroad. And I was just sitting in his living room, and I looked up, and I'd seen it was at auction.
0:41:08 > 0:41:09And we started discussing it.
0:41:09 > 0:41:14And then to see it at auction, I thought, "Might as well have a look, and see what's happening with it."
0:41:14 > 0:41:18Obviously, I'd done some research into it, and got the legal pack and had a little look through.
0:41:18 > 0:41:22- But really, really happy with it. - So, why did you want to buy it?
0:41:22 > 0:41:26Just from looking at the guide price and looking at the rental income from it.
0:41:26 > 0:41:29Just thought it was too good to be true, really.
0:41:29 > 0:41:30So tell me more about you, what do you do?
0:41:30 > 0:41:34I work offshore with underwater vehicles. Like underwater robots.
0:41:34 > 0:41:39Basically a lot of the time it's for like a telecommunications company -
0:41:39 > 0:41:42laying and maintaining fibre-optic cable networks.
0:41:42 > 0:41:46- It sounds like something out of Thunderbirds.- Yeah, it's a bit odd.
0:41:46 > 0:41:49The good thing is, I do about six months a year.
0:41:49 > 0:41:51Obviously, get quite a few holidays in,
0:41:51 > 0:41:54try and do snowboarding in the winter, and beach life in the summer.
0:41:56 > 0:41:58- THUNDERBIRDS INTRO:- Five... Four...
0:41:58 > 0:41:59Three...
0:41:59 > 0:42:03So a world of scuba-diving, robots and underwater vehicles,
0:42:03 > 0:42:08with six months off throughout the year in which to go snowboarding and sunbathing. It's a tough job!
0:42:08 > 0:42:13But I suppose someone has to do it. Still, he now has the mission
0:42:13 > 0:42:17of maximising his investment. So, it's a case of F-A-B, Tony!
0:42:22 > 0:42:23So, tell me what you're gonna do.
0:42:23 > 0:42:27Obviously, the shop looks after itself. The flat,
0:42:27 > 0:42:29I've got somebody that wants to move in.
0:42:29 > 0:42:33Gonna lease that out for £1,000 a month.
0:42:33 > 0:42:35- Wow!- There's work to do in the office,
0:42:35 > 0:42:39which is a nice little project, which I'm gonna try and maybe take up next time I come back from work.
0:42:39 > 0:42:42Just while I'm away, get things ticking over.
0:42:42 > 0:42:45Now, a big bonus, this place has a cellar. Shall we go and have a look?
0:42:45 > 0:42:47- Yeah, definitely.- Come on, after you.
0:42:47 > 0:42:52Well, you could definitely have some fun down here, couldn't you?
0:42:52 > 0:42:57- Yeah, definitely. It was a bit of a find, really.- So, do you have any idea what you're gonna do down here?
0:42:57 > 0:43:01- At the moment, erm, thinking of maybe hanging a punchbag up.- A punchbag?!
0:43:01 > 0:43:04And put a bit of gym equipment down. And it's a bit of a storage area.
0:43:04 > 0:43:10I wasn't sure what you're allowed to do with it cos there's no light, and no natural ventilation.
0:43:10 > 0:43:16I mean, you can get all sorts of things, like light tubes and ways of getting natural light down here.
0:43:16 > 0:43:20- But the thing to do is to get a builder...- Yeah, get somebody in that knows a bit more than I do.
0:43:20 > 0:43:23As I say, it was just a bit of a find, really.
0:43:23 > 0:43:25Bought the place, came down, had a look, and was like...
0:43:25 > 0:43:28So you didn't know this was down here when you bought it?
0:43:28 > 0:43:31I didn't realise it was quite as big as it was.
0:43:31 > 0:43:35Cos I just, erm, had seen some pictures, and it was just the small area.
0:43:35 > 0:43:38So what's the timescale for working on this bit?
0:43:38 > 0:43:40Just leave it as a project. Just keep myself busy
0:43:40 > 0:43:45when I'm back from work. If I wanted to do something, it could be like over six months, a year...
0:43:45 > 0:43:47- And it's just something to add on to the property.- Good luck with it all.
0:43:47 > 0:43:50Excellent, thanks very much. Cheers!
0:43:50 > 0:43:57Tony has got the exciting prospect of renovating the cellar, and sorting out that office.
0:43:57 > 0:43:58How is he gonna get on?
0:43:58 > 0:44:00Find out later in the show.
0:44:02 > 0:44:05Time is the enemy when property developing.
0:44:05 > 0:44:09Every day you go over your schedule, it adds to your budget.
0:44:09 > 0:44:16- So did our buyers' timescales go adrift, or did they stay on track and on budget?- Let's find out.
0:44:20 > 0:44:25We're back in Lewisham, southeast London, to see how absolute beginner
0:44:25 > 0:44:29Jo is doing with her first steps in the property investment world.
0:44:29 > 0:44:35She and her husband bought this one-bedroom Victorian flat for £130,000, intending to rent it out.
0:44:35 > 0:44:40Renovations for the inexperienced are usually fraught and worrying affairs.
0:44:40 > 0:44:44But Jo was approaching the whole thing with carefree optimism.
0:44:47 > 0:44:51- Have you ever done anything like this before?- No, first time.
0:44:51 > 0:44:57- How d'you think you'll be as a project manager?- Oh, it's a friend of ours, so it's only him and me.
0:44:57 > 0:45:02And beyond us getting on each other's nerves, cos he talks a lot and I talk a lot, I think we'll be fine!
0:45:02 > 0:45:06- So tell me your timescale for the work.- A month. - Is that realistic?
0:45:06 > 0:45:08Who knows? I don't know!
0:45:11 > 0:45:14It did take Jo longer - because we're returning three months later.
0:45:14 > 0:45:17Let's find out how she's done.
0:45:20 > 0:45:25Well, if Jo has been stressed during the renovation, she's certainly not showing it.
0:45:27 > 0:45:32First stop, the reception room. This had a beautiful high plasterwork ceiling that I just loved.
0:45:32 > 0:45:38But there was a less-than-beautiful damp patch near the window that frankly I could have done without.
0:45:41 > 0:45:44But now, just look at it.
0:45:44 > 0:45:48A modern, stylish room, decorated in keeping with its Victorian heritage,
0:45:48 > 0:45:53with plush, chocolate-coloured curtains, that give real elegance to the room.
0:45:56 > 0:46:00Meanwhile, next door, the neutral colour scheme continues.
0:46:00 > 0:46:05When we bought this flat, we decided that because it's a beautiful period building,
0:46:05 > 0:46:08that what was missing in the flat were fireplaces.
0:46:08 > 0:46:12I bought this off the internet, and it's the real deal.
0:46:12 > 0:46:16We bought this one and bought the one in the living room from the same people.
0:46:16 > 0:46:18I think it definitely adds value to the flat.
0:46:18 > 0:46:21They're beautiful, I think they're great.
0:46:21 > 0:46:27Talking of firepower, if ever there was somewhere in need of some, it was this drab bathroom.
0:46:27 > 0:46:34But Jo has worked her magic and created a warm and cheerful room, worthy of a long, relaxing soak.
0:46:37 > 0:46:43Now, the kitchen, we've spent the most amount of money on. Considering the size of the kitchen,
0:46:43 > 0:46:48we bought white goods, and we spent about four grand. But I think it's money well spent.
0:46:48 > 0:46:54The only problem with all the flat is the garden. That's the only thing that's still outstanding.
0:47:00 > 0:47:03It's a jungle, all right! The back garden,
0:47:03 > 0:47:07which belongs to all the flats in the building, has grown even wilder!
0:47:07 > 0:47:11When Jo first bought the flat, there was a question mark over who was responsible
0:47:11 > 0:47:15for maintaining it, and why that wasn't being done.
0:47:15 > 0:47:20And it seems as though they haven't made much progress with getting an answer.
0:47:23 > 0:47:26Been talking to the landlord, and we had a result.
0:47:26 > 0:47:28And they've said that yes, it does need doing
0:47:28 > 0:47:33cos it's now so overgrown that you could lose a mid-sized person in the garden.
0:47:33 > 0:47:36They're sending in contractors and they're coming next week.
0:47:36 > 0:47:39And then going forward, we will discuss with
0:47:39 > 0:47:44the other three tenants who's gonna pick up the maintenance charge. The scaffolding,
0:47:44 > 0:47:49it's not that it's up there because the house is falling down. Apparently it's been there for over two years.
0:47:49 > 0:47:52So someone's just forgotten that they've put it up.
0:47:52 > 0:47:55The freehold owners are going to sort it out.
0:47:55 > 0:47:58But this apart, the renovation has gone very smoothly.
0:48:00 > 0:48:05You would imagine that when you rip bathrooms and kitchens out, you're gonna unearth something.
0:48:05 > 0:48:07But nothing, touch wood,
0:48:07 > 0:48:13other than pipework and bits and pieces. But, for the most, it's been really, really easy.
0:48:13 > 0:48:16Part of the reason for the success is that Jo worked
0:48:16 > 0:48:21with just one builder, and they were able to keep a watchful eye on quality control.
0:48:21 > 0:48:25In fact, it was only when other people got involved that problems seemed to occur.
0:48:27 > 0:48:33My husband was thinking about putting furniture into the flat, when we decided we were gonna rent it.
0:48:33 > 0:48:37And he was saying that he wanted to put in a new TV, a plasma TV.
0:48:37 > 0:48:42And I was like, "No, that's just a waste of money. He turned round and said, "No, what we could do is,
0:48:42 > 0:48:47"we could put our TV in there and we could buy a new one!" I was like, "Right. No, it's not gonna happen!"
0:48:47 > 0:48:52It looks like Jo has been in control of all her renovation costs.
0:48:52 > 0:48:55So how has her budget fared?
0:48:55 > 0:48:59Initially we set £10,000, and it came out to around 10-and-a-half.
0:48:59 > 0:49:03So that's not bad, considering it was our first piece of work.
0:49:03 > 0:49:05On budget and to a high standard.
0:49:05 > 0:49:10The only thing missing now is some feedback from two local estate agents.
0:49:18 > 0:49:21What do they think of the renovation?
0:49:24 > 0:49:28The flat itself is far better, it's in incredible condition.
0:49:28 > 0:49:31They've done a real good job of refurbishing it.
0:49:31 > 0:49:35The property's spacious. It's got high ceilings and good proportions.
0:49:35 > 0:49:38There's no real negatives I can pick up on in the property.
0:49:38 > 0:49:40I think it will be well received on the market.
0:49:40 > 0:49:43It's top marks for Jo and her builder.
0:49:43 > 0:49:48But the big question is, how much is it now worth?
0:49:48 > 0:49:55Jo bought the one-bedroom flat for £130,000, plus the usual costs and expenses.
0:49:56 > 0:50:03She spent £10,500 renovating it, so that's a grand total of £140,500.
0:50:03 > 0:50:08So how much do the agents think it's now worth?
0:50:08 > 0:50:10Something up to about 180, as an asking price.
0:50:10 > 0:50:15I would market the property at around 190,000, and hope to achieve offers around 180.
0:50:15 > 0:50:21We were expecting 180. So, not overly happy, not unhappy.
0:50:21 > 0:50:25Jo may sound a bit underwhelmed by the estimated price.
0:50:25 > 0:50:30But in fact, that's a pre-tax profit of almost £39,500.
0:50:30 > 0:50:35Most people would think that's a very good return!
0:50:35 > 0:50:38Still, Jo has always had plans to make this a rental property.
0:50:38 > 0:50:41So how much could that achieve?
0:50:41 > 0:50:45- £750 per calendar month. - Between £750 and £800 a month.
0:50:45 > 0:50:48Rented out, with the local estate agent, at 850.
0:50:48 > 0:50:52Overall, I think the experience has been a very positive one.
0:50:52 > 0:50:56For the future, if we come across another property that we like,
0:50:56 > 0:51:01and we think that we can get it at a good price at auction, then we may do that. But we'll see.
0:51:07 > 0:51:13It's back to Watford now, to see how Tony's doing with the property he bought at auction.
0:51:13 > 0:51:19- Although- doing- may not be the right word, since there was very little that needed- doing.
0:51:20 > 0:51:26He bought a shop that was already let, and an immaculate two-bedroomed flat.
0:51:26 > 0:51:30With the income from the shop alone likely to cover his mortgage payments, it was a case of...
0:51:30 > 0:51:37# Nice and easy does it every time! #
0:51:37 > 0:51:42OK, he did have one or two jobs to do, because also included in the auction lot
0:51:42 > 0:51:46was a small office in need of modernisation,
0:51:46 > 0:51:49and a large cellar with endless development possibilities.
0:51:49 > 0:51:53Let's see what Tony has decided to do, when we return seven months later.
0:51:59 > 0:52:01And here comes 27-year-old Tony.
0:52:01 > 0:52:05He often works abroad, laying communication cables
0:52:05 > 0:52:09under water, with the help of submarines and robots.
0:52:09 > 0:52:12Let's see exactly what he has done here, starting with the office.
0:52:12 > 0:52:17And...it's a huge improvement.
0:52:21 > 0:52:25OK, well, erm, this is the only bit of the property that we've changed.
0:52:25 > 0:52:30Basically, there was horrible sort of wood on the walls, panelling, which we ripped off,
0:52:30 > 0:52:35which gave us this brickwork, which we've had repointed. It just gives it quite a nice feel.
0:52:35 > 0:52:39There was a false ceiling, which needed pulling down either way.
0:52:39 > 0:52:43Basically just opened it up. It was easier just to board it off.
0:52:43 > 0:52:45And it made the space a lot more open.
0:52:45 > 0:52:48Put a new little kitchenette in and toilet.
0:52:48 > 0:52:52So it's a nice, clean, usable space now.
0:52:52 > 0:52:56Tony did a great job with the office but what about the cavernous cellar?
0:52:56 > 0:53:01Did he manage to renovate it to its full potential?
0:53:03 > 0:53:08Yeah, as you can see, not a great deal's happened down here. I managed to get my weights in, though.
0:53:08 > 0:53:09And finally got my punchbag up.
0:53:11 > 0:53:15Well, it's not quite the renovation we were hoping for.
0:53:15 > 0:53:18Weights, a punchbag, and golf clubs.
0:53:18 > 0:53:23Plastered walls and light vents was more in keeping with our expectations.
0:53:23 > 0:53:28But let's give Tony a sporting chance here, as his work takes him away from home a lot.
0:53:28 > 0:53:31So how has he done with renting out the upstairs flat?
0:53:31 > 0:53:34Originally, the spacious two-bedroomed property
0:53:34 > 0:53:39was in showroom condition, so surely he shouldn't have had any problems here.
0:53:44 > 0:53:47Well, there are signs of life.
0:53:49 > 0:53:53It looks like the flat has been rented out.
0:53:56 > 0:54:00I had some friends coming over from America who planned to stay two or three months.
0:54:00 > 0:54:03And I knew somebody else that wanted to rent a room.
0:54:03 > 0:54:05They've gone back now.
0:54:05 > 0:54:08The short-term rent is up. And then we'll see
0:54:08 > 0:54:11if the current tenant wants to take the whole property over,
0:54:11 > 0:54:15or I'll speak to some agents with regard to the office and then here.
0:54:15 > 0:54:19So the top floor is now earning Tony money.
0:54:19 > 0:54:23But why did he not develop the basement in order to maximise his return?
0:54:25 > 0:54:28I think there is potential at some point in my life to develop it.
0:54:28 > 0:54:31But at the moment, I just haven't got the time.
0:54:31 > 0:54:36I think if I had the money to spend on a project like that, I'd rather invest it in another property.
0:54:36 > 0:54:41Putting the question of the cellar on hold, Tony still has another problem.
0:54:41 > 0:54:44As he works abroad for long periods of time,
0:54:44 > 0:54:49how will he be able to run this diverse and intricate property venture?
0:54:49 > 0:54:51My brother, he's been quite handy.
0:54:51 > 0:54:54He actually lives very close and he's been helping us
0:54:54 > 0:54:58with the project. The guys we've had in for plastering and pointing, he's arranged that.
0:54:58 > 0:55:01And I think, with regards to the rent and stuff like that,
0:55:01 > 0:55:06he's gonna look after this property and any future properties I'm interested in, so...
0:55:06 > 0:55:10Without any shadow of a doubt, this has been a success for Tony.
0:55:10 > 0:55:14The only question remaining is, how much of a success?
0:55:14 > 0:55:17Two local estate agents are on hand to answer exactly that.
0:55:26 > 0:55:29What do they think of what Tony has done so far?
0:55:35 > 0:55:39Very minimal changes to the property. The only thing that's been done
0:55:39 > 0:55:43is the office. And the work that's been done there is excellent.
0:55:43 > 0:55:47We had this property on the market for £300,000 18 months ago,
0:55:47 > 0:55:49just for this flat.
0:55:49 > 0:55:53And the fact that he's now bought it for £297,000 for the whole lot is a fantastic deal.
0:55:53 > 0:55:59OK, calculator time. Tony bought the combined property for 297 grand
0:55:59 > 0:56:02plus the usual costs and expenses.
0:56:02 > 0:56:05He has spent around £2,000 renovating the office.
0:56:05 > 0:56:09How much do the estate agents think it is now worth?
0:56:12 > 0:56:14I would value the flat at £225,000.
0:56:14 > 0:56:19Add the shop into that at £150,000, showing an 8% yield.
0:56:19 > 0:56:23If they rent the office for £100 a week, potentially another £50,000.
0:56:23 > 0:56:28I think that this development would be worth around £450,000 in the current market.
0:56:28 > 0:56:35So they think the property is currently worth between £425,000 and £450,000.
0:56:35 > 0:56:43That could be a pre-tax profit for Tony of at least 126 grand. Wow!
0:56:43 > 0:56:47You can't fault it, can you? It's been brilliant. So if I can find
0:56:47 > 0:56:50another one like this, I'll definitely be going for it.
0:56:52 > 0:56:54That's all we have time for on Homes Under The Hammer.
0:56:54 > 0:56:59But do join us next time for more news from the trenches of the property battlefield.
0:56:59 > 0:57:02- We'll see you then. - Goodbye.- Goodbye.
0:57:02 > 0:57:06For more information about Homes Under The Hammer,
0:57:06 > 0:57:10including how the programme was made,
0:57:10 > 0:57:14visit the website at bbc.co.uk
0:57:14 > 0:57:18Subtitles by Red Bee Media Ltd.
0:57:18 > 0:57:20E-mail subtitling@bbc.co.uk