Episode 71 Homes Under the Hammer


Episode 71

Series about properties that have gone to auction. Martin Roberts and Lucy Alexander visit a mid terrace in Stoke-on-Trent, a three-bed house in Hampshire and a semi in Leeds.


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Transcript


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In a challenging housing market it's more important than ever to buy in the right location.

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Buying a property in the right place will make it easier to sell and rent out.

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Because there are property auctions held all around the country,

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the chances are you'll find your home under the hammer.

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As we know, buying property

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can be one of the most stressful things you do.

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And it's important not to underestimate

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the amount of pressure and problem solving that's involved.

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So, can our buyers take the strain?

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Let's find out.

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Coming up, there's a property to get your teeth into in The Potteries.

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This is your property fodder.

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It is a two bedroom mid-terrace.

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There's something missing from this three-bed house in Gosport, Hampshire.

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If you look out here, well, basically, there's no roof.

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And I'm worried about the back bedroom of the semi-detached in Leeds.

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Oh, dear.

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All these properties have been sold at auction.

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

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when they went under the hammer.

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Well, you'd have to have been living on a different planet

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not to know that property prices have gone through some sticky times recently,

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and it's no different here in Stoke where last year they dropped by 13%.

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However, in the good old days of 2005,

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he average terraced house was going up a massive £700 a week.

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Now, the key is to spot when that is about to happen again.

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And that's the problem -

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barring a crystal ball, how do you second guess the property market?

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Well, the answer may well be found here in The Potteries.

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I'm in Fenton, to see the kind of property

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that I think acts as a real barometer

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to the British housing market in general.

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This is your property fodder.

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It is a two-bedroom mid-terrace.

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It had a guide price of 35,000 quid,

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but what did it sell for at a recent auction?

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I'll tell you later. Let's go and have a look round first.

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Outside this place looks to be in pretty good nick.

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It's already double-glazed, which should save a bob or two,

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but I'm guessing there's more to do inside.

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Well, I guess you're not going to expect anything too spectacular

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or different from any other two-bedroom terrace and,

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you know what? You'd be absolutely right.

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But that's one of the great things about them,

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you know what you're going to get.

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This one, on the face of it, it doesn't smell bad,

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reasonable sized ceiling height.

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It's got a gas fire which obviously needs replacing,

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but overall, yep, pretty much as I predicted.

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It's got a few nice original features.

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I'd certainly take some time to do things like open up the fireplace

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because that would be lovely as a central feature

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of this rear room here. I mean, look at the floor.

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I don't know if it's possible to get that sorted out,

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but it's quarry tiles, they would actually be quite pleasant.

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It's not a bad sized rear room.

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You've got the stairs to your bedrooms there

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and through into the kitchen.

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Built in an extension on the back, it's not a bad sized space.

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Classic kind of layout there.

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You've got the loo and the bathroom out through the kitchen there.

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Not ideal, but actually pretty much what people expect from a property like this,

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so probably not worth the expense of moving it.

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All in all, it does what it's supposed to do.

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And, whilst we're talking about original features,

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there are some lovely high skirting boards here

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along with original coving and cornice.

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Upstairs there are two decent sized bedrooms,

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one at the back and one at the front.

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At the rear, this lovely cobbled alleyway leads to off-street parking.

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What does a local estate agent make of this as a potential investment?

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In terms of renovating the property,

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taking into account new kitchen, new bathroom, rewire,

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I would imagine you need to spend

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somewhere in the region of 10,000 to 12,000

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to get it to the standard that we'd want it to be

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and I think what you would do is make the best of the layout as it is.

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I don't think there's any scope for changing this layout.

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If you picked this up for around the £35,000 guide price,

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then with the £10,000 to £12,000 renovation costs,

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this could make a very worthwhile investment.

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Once the renovations are done on this property,

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the potential marketing figure at the moment

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would probably be round about 69,950 as an asking price.

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I would anticipate it being more an option for an investor to rent out in the short term.

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With a contemporary gloss on it, I would expect it to be doing

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£425 per calendar month easily, possibly a little more.

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And that could mean a 10% rental return.

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So, a perfectly respectable solid little house

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that would make a great home or a good rental investment.

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Now, remember, I think this is a barometer of UK property prices

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and activity at the auctions in particular.

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It had a guide price of 35,000 quid.

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What happened when it went under the hammer?

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Lot 37 is Turley Street or Tiley Street in Fenton.

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30, are you going to say? 30, I'm bid in the middle.

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Thank you. At £30,000. 35 can I say now?

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35 against the wall. 40.

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45 against the wall?

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Take one off you.

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At £40,000. 41.

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42 is it now? New bidder front row.

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£42,000. 43. 44.

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44 and a half. 45. Another half?

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45 and a half. 46. And a half.

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47.

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Where, where, where?

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By the curtain, there we go. 47 and a half.

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48.

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At 48,000. 48 and a half. Yeah.

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49. 49 and a half.

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50.

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50. And a half.

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No? At 50,500 then.

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A new bidder right at the back. 51.

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51 and a half. 52. 52 and a half. 53?

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Shaking his head. 52 and a half. Still with you, sir.

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At 52,500 then first time.

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52,500. He's back in. 53. And a half.

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Definite? 53 and a half then.

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Bid's here. At 53,500 the first time.

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53,500, second time. Third.

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54 in the aisle. 54 and a half.

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55 it'll cost you now.

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No. That was short and sweet.

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£54,500, then. Left still at 54,500.

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Are we all done? First time.

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Second time. Third and final time at 54,500.

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All done? 54,500.

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Well done, you bought it.

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There was a lot of interest in this one and for 54,500,

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nearly £20,000 over the guide price,

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the determined winning bidder was Kevin.

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He owns a heating and ventilation company,

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but has been investing in property for some time.

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His eldest son, Dan, will be joining him on this project.

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I met up with them at the house.

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Kevin, Dan, lovely to meet you both. Congratulations!

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-So, why did you pick this property?

-Location. Good location.

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The house itself has got a lot of character.

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You know, original features.

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I like the block, there's only a few houses in the block.

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It's more of a cottage to me than a terraced house, you know?

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So, that's a nice benefit.

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And every house in this little block,

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both sides is really well kept, you know?

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And I want to make this one of them.

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-So, tell me about you two, then.

-Yeah, well, this is Dan, my lad.

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He's 20, yeah?

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I started in business, not building business, not property business,

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-20 years ago, the week he was born.

-Oh, wow!

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Not a good time to start, really,

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but things have went successful or have gone successful

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and Dan started in the business now what, 18 month...

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Yeah, about two years. I left college and then he said,

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"You know, you've got to find something to do,"

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so I went with him and he said "See what you enjoy,"

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See what I was enjoying, and went on and did a course in joinery and stuff and now we're in it and...

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So, is the idea that you're going to work together on projects?

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Well, if he pulls his finger out and performs, yeah.

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Kevin obviously has high expectations of his eldest son, Dan.

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With youngest son, Matt, also lined up to help

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and Mum doing the bookkeeping, this renovation is a real family affair.

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So, Dan, give me an idea of what you're going to do to this place?

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I'll probably come in, you know,

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get all the bulk of it out, all the carpets, all the messy stuff first.

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Probably start stripping the walls down.

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Basically, give it a good gut first before we start doing anything.

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Get all the messy stuff out of the way.

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This floor'll have to come up cos it's got no damp course.

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-These tiles, as you can probably see, the...

-Lovely.

-£1.50 each.

-Are they?

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Reclamation yard, yeah.

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So you're going to take them up and sell them on?

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No, what I'm hoping to do is open the chimney breast out,

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make them a feature, and then we'll reuse the quarry tiles in the hearth.

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-Oh!

-We'll try and reuse the stuff in the house if we can.

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The main thing is the kitchen and the bathroom and then...

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It'll be a good house. It will be replastered when this chip...

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The chip paper comes off, if Dan gets there.

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Very kind of you to give him that job!

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One of the worst jobs in the world, scraping off woodchip!

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-There is wood in it, he is a joiner!

-That's a bit of a tenuous...

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Dan definitely drew the short straw here,

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but he says he's up for the challenge

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and it's good to know that Kevin plans to make the most of the character of this place.

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They've set themselves an £8,000 to £10,000 budget and,

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at the moment, they're planning to rent it out,

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but it all depends on the state of the market when the work is complete.

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-What's the timescale for doing the work?

-If all goes to plan, and I'm looking at Dan here!

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If all goes to plan and my main business is a bit quieter and we can concentrate on this,

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we could do this in two month, easily.

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To be honest, probably six week.

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-So, Dan, what do you think of that timescale?

-Yeah, I think...

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I mean, we'll get it in time easy. You know, just work hard at it.

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If we just crack on it we're here for a good couple of weeks, yeah, we'll be easily...

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Good luck to you both and I hope it turns out well

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and especially good luck with getting the wood chip off!

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-I'm going to go at it!

-Yeah.

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-Nice, neat lines will be here when you come back.

-I can't wait to see it.

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So, there you have it, the auction rooms are buzzing once again and

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properties are surpassing their reserve prices.

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In terms of this one, well, Kevin and Dan,

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I think they've got the experience to make it happen,

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but I'm not sure that Kevin is going to be

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quite the relaxed taskmaster that Dan's expecting,

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and he's got all that woodchip to get off!

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How's he going to get on? You can find out later in the show.

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This is Gosport in Hampshire.

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Now, the town overlooks Portsmouth, which is just across the harbour

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and, as you can see behind me, there's the Spinnaker Tower which is Portsmouth's famous landmark.

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Now, until the last quarter of the 20th century,

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this area was a major naval and military centre.

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Well, I'm here to see a property today, it's just around the corner

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and it's only half a mile from the town centre.

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Although Gosport doesn't have its own railway station,

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it does have good schools and a regular ferry service across the harbour to Portsmouth.

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Access to London and the rest of the country is easy.

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I'm here to see this three-bed mid-terrace

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which had a guide price of just 70,000 to 75,000.

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Now, that's pretty good value for a property around here,

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but there is a reason for that.

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Now, the catalogue says this place needs "A full programme of refurbishment".

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Well, a lot of auction properties usually do, but I've been told that I might need a hard hat.

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Very ominous. I'm going in!

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It does look a bit tatty and run down from the outside, it's on a busy main road,

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but I haven't seen enough to explain that low guide price yet.

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There's literally years worth of mail in this hallway, it's just

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completely and utterly littered, and it's really run down inside.

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Now, I don't know about a hard hat, though.

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You can see all the old furniture's been left by the previous occupant.

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There's a big hole over there in the ceiling by the bay window.

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So, you know, it needs some care and attention,

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but once you get the skip outside

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and you completely clear this place out,

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dump it all in there, give it a clean,

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it will look like a completely different house.

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It does need a lot of TLC.

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Now, this kitchen looks like it hasn't been touched in years.

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It's quite surprising because if you look over here

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you can see the washing machine has dropped into the ground.

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The tiles are all coming off.

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Ah-ha!

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Now I know why the hard hat was mentioned,

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because if you look out here,

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well, basically, there's no roof on this extension out the back.

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You can see the sky, you can see daylight,

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it has just collapsed and, look, there it is.

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And that is the only bathroom in the house.

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It looks more like a garden. Talk about bringing the outside in!

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This place isn't just a refurbishment job,

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it's a major renovation project.

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It looks as though the upstairs is in the same state as the downstairs.

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Now, in the catalogue there's a statement that I have never seen before

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and it's a real reflection of the current state of the money market at the moment.

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It says "This property will not be suitable for high loan to value mortgage dependent clients."

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Now, that means it's unmortgageable unless you have a large deposit.

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Basically, it's cash buyers only for this one.

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But if you've got the readies available,

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at around the guide price of between 70 to 75 grand,

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you'd be getting a pretty decent-sized house.

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If you can look past the piles of rubbish, upstairs you'll find two

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large double bedrooms and a generous single.

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You could move the bathroom up there,

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but that would mean sacrificing a bedroom.

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But there is an alternative,

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I'm just not sure it makes financial sense.

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Due to the extent of damage inside here

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it might be worth rebuilding this extension completely.

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It's worth thinking about applying for planning permission

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to also add another storey like they have over there.

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You could make the kitchen bigger,

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you could move the bathroom upstairs without sacrificing a bedroom,

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but you've got to weigh up whether it's cost effective to do so

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and, in this climate, probably not.

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But you do have a great sized family garden at the back.

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Curiously, given the state of the inside,

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it isn't completely overgrown.

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Hmmm, some investigation is needed.

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I found out a little more from neighbour Sarah

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who's obviously delighted that this house went up for auction.

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It's been the bane of our life since 1999 when the property was vacated.

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The neighbour the other side has been maintaining the garden to keep it looking, you know...

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Because we were extremely worried about people squatting and fires.

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We've had rats, we've had damp,

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we've had to have the council in on numerous occasions.

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You must be so relieved to think

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that somebody's taking over this house!

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Oh, I just can't tell you how relieved I am.

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We're absolutely thrilled, all of us, all the neighbours are.

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The house has been abandoned for years.

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It's got rats, a derelict rear extension and an unusable bathroom,

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so even at a guide price of 70,000 to 75,000

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was this really a good buy?

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I asked a local estate agent for the facts and figures.

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Currently there would still be a good demand

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for a property such as this in good condition

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and you would look to achieve

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somewhere between £130,000 and £135,000.

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With the house guided at 70,000 to 75,000,

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that would leave around £60,000

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for everything that needs doing here and room for a profit.

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With an expected rental income

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of around £625 to £650 per calendar month,

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you could be looking at a 7% to 8% return here.

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This isn't a property for amateurs.

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It's in a complete state.

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It needs everything doing to it

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and that extension will probably have to be completely rebuilt

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and, more importantly, it's so bad you won't be able to get a big mortgage on it.

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So, who was the buyer who had enough cash to splash on this place

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in the auction room?

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Lot 17, Anne's Hill Road in Gosport, Hampshire.

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This is a terraced house in need of comprehensive refurbishment.

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If somebody was to bid the sum of just £60,000.

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Is somebody prepared to get me underway at that...

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Thank you, sir. 60 I've got.

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65? 65,000 I have in front of me.

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70,000, sir. 75?

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Yeah. 75,000 we've got.

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76,000 on the wall here.

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Looking for 77. 77,000 seated here.

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78 I have got. 79, sir?

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I'll take the half at this stage. 78 and a half.

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Now back to you at 79. 79,500.

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79 and a half he says yes, to.

0:18:590:19:03

80,000 the gentleman's on the wall saying yes to.

0:19:030:19:06

Now I'm looking for that same. No?

0:19:060:19:08

80,000 we have got. New bidder at 80,500 on the back wall.

0:19:080:19:13

Now looking for 81. 81 and a half?

0:19:130:19:16

81,500 on the back wall.

0:19:160:19:19

82,000 we have now.

0:19:190:19:21

82 and a half thousand the gentleman comes back with.

0:19:210:19:24

83, sir? No.

0:19:240:19:27

82,500 on the back wall then, I have for the first time.

0:19:270:19:32

82,500 I have for the second time.

0:19:320:19:35

82,500 for the third and final time.

0:19:350:19:41

Your property, sir, well done. Your number, please?

0:19:410:19:43

Coming in right at the end with a bid of £82,500

0:19:430:19:47

for that derelict mid-terrace in Gosport was local man Keith.

0:19:470:19:53

He's bought this place in partnership with friend Neil and they plan to let it out.

0:19:530:19:58

This was Keith's first auction

0:19:580:20:00

and it's to be their first joint project.

0:20:000:20:02

Have they bitten off more than they can chew?

0:20:020:20:05

I met up with them at the property.

0:20:050:20:07

-So, guys, what was it that you loved so much about this property?

-The challenge!

0:20:070:20:12

The luxury?

0:20:120:20:14

-That, too!

-I don't think so!

0:20:140:20:16

I mean, you know, you have got no back end of the house.

0:20:160:20:18

It's collapsed, almost. You can even see by the washing machine how that's fallen into the floor.

0:20:180:20:23

Yeah, years of water damage has come through the roof

0:20:230:20:26

and out of the washing machine, but it's all repairable.

0:20:260:20:28

As soon as we strip it out we can see how far the damage has gone

0:20:280:20:32

and then work our way from there, really.

0:20:320:20:34

And what about the fact that, on the details of the auction catalogue,

0:20:340:20:38

it mentioned, you know, it's basically for cash buyers only.

0:20:380:20:41

If it was mortgageable I honestly believe it probably would have gone

0:20:410:20:45

for a considerable amount more money than we actually obtained it for.

0:20:450:20:48

So, you're quite pleased you got it for 82 and a half?

0:20:480:20:51

-Yes, we are, very.

-That really is quite good value for money

0:20:510:20:54

when you think it's a big house, isn't it?

0:20:540:20:56

It's a good traditional town three-bedroom property.

0:20:560:21:00

They're much sought after in the area

0:21:000:21:02

and by putting it back with our budget

0:21:020:21:05

we think we could turn it round,

0:21:050:21:07

put it back out on rent and be very pleased.

0:21:070:21:09

Keith and Neil would have gone up to a maximum of £85,000 at the auction.

0:21:110:21:15

That means they can allow themselves slightly more

0:21:150:21:18

than their initial 30 grand renovation budget.

0:21:180:21:21

But have they got the experience to take on a project like this?

0:21:210:21:25

I've done a few. I'm a carpenter by trade and I can do most things,

0:21:250:21:31

so that adds and keeps the costs down obviously as much as we can.

0:21:310:21:35

-So, that would be my main input, I think.

-What about you?

0:21:350:21:38

Don't ask me that question! My strengths, I don't know?

0:21:380:21:41

Project management, shall we say?

0:21:410:21:43

No, we both have got a skill of hand,

0:21:430:21:45

so between us it shouldn't be a problem.

0:21:450:21:47

What plans have you got for the house?

0:21:470:21:49

Obviously putting everything right that's wrong.

0:21:490:21:52

Are you intending on doing building work?

0:21:520:21:54

No real build work other than the roof repairs at the back

0:21:540:21:57

and also a small roof repair at the front of the property.

0:21:570:22:00

Everything's going to have to be taken back.

0:22:000:22:02

Everything's going to be replastered, rewired, new central heating.

0:22:020:22:06

We're going to convert this room back into two receptions

0:22:060:22:09

because we think that suits the rental market specifically.

0:22:090:22:13

Now, what about the thought of possibly having a double storey extension out the back and...?

0:22:130:22:18

It wouldn't value high enough for us to do.

0:22:180:22:20

It would cost too much, so it's not worth doing, in our opinion.

0:22:200:22:24

-And are you going to keep the bathroom downstairs?

-Yes.

0:22:240:22:27

Because you need the three bedrooms to let upstairs?

0:22:270:22:30

We need the three bedrooms upstairs, yes, but also we are looking

0:22:300:22:34

into putting just a toilet upstairs for the children.

0:22:340:22:37

Now, that is a good idea.

0:22:370:22:39

The guys are obviously looking at this as a family rental so a loo upstairs will really help.

0:22:390:22:44

They've set a target of three months to do all the work, but there's one thing that really worries them.

0:22:440:22:50

-The rats.

-Rats.

0:22:500:22:51

No, I think once we actually start the work probably the rats will...

0:22:510:22:55

-Vacate the property.

-Vacate the property.

0:22:550:22:57

-We're hoping they will do, anyway!

-They'll move on to another location!

0:22:570:23:01

-Yeah.

-That's what we're expecting.

0:23:010:23:03

Good luck. It's going to be really exciting

0:23:030:23:05

seeing the end product here.

0:23:050:23:07

-Really nice to meet you today.

-And you. Thanks very much.

-Thank you.

0:23:070:23:10

This is Neil and Keith's first development project together and they've picked a pretty major one!

0:23:160:23:21

Will they be successful or will this cash buy become a money pit?

0:23:210:23:26

Find out later in the programme.

0:23:260:23:28

Still to come, there's work to do at this three-bedroom semi in Roundhay, Leeds.

0:23:300:23:35

Well, that needs sorting out, doesn't it?

0:23:370:23:39

We return to Gosport to find out what's made the neighbours so happy.

0:23:400:23:45

To see it evolve into what it is today is lovely.

0:23:450:23:49

But first, in Fenton, has Dan managed to deal with all that woodchip wallpaper?

0:23:510:23:56

It's a hassle to get off but, stick at it, get your teeth into it.

0:23:560:23:59

Two-bedroom terraced houses like this one in Fenton in The Potteries

0:24:030:24:08

are the life blood of the British property market.

0:24:080:24:11

They're ideal for first-time buyers and renters alike

0:24:110:24:14

and you sense that the market may have started moving again

0:24:140:24:19

when a property developer like Kevin was prepared to pay £54,500

0:24:190:24:24

for a house that was guided at just 35,000.

0:24:240:24:28

Kevin had a budget of 8,000 to 10,000 and a timescale of eight weeks to turn this place around.

0:24:280:24:33

Somehow he'd managed to persuade his son and trained joiner Dan

0:24:330:24:37

that removing all the chipped wallpaper was his responsibility.

0:24:370:24:42

There is wood in it, he is a joiner!

0:24:440:24:46

-You really drew a short straw there, didn't you?

-I know.

0:24:460:24:49

So, ten weeks on, how have Dan and Kevin got on?

0:24:490:24:54

The property was already double-glazed,

0:24:540:24:57

so there wasn't much to do at the front,

0:24:570:25:00

but they have fitted a new front door

0:25:000:25:02

which leads into a transformed living room.

0:25:020:25:06

The woodchip has been replaced with freshly plastered walls and accent wallpaper.

0:25:060:25:11

Where the old nondescript fire once stood

0:25:110:25:15

there's now a lovely feature fireplace

0:25:150:25:18

created from those old floor tiles.

0:25:180:25:20

And the drab old carpet has been replaced with new laminate flooring

0:25:200:25:25

which carries on into the back reception.

0:25:250:25:27

As you can see now all the decoration is completed.

0:25:270:25:30

It's all been stripped to the bare bones.

0:25:300:25:32

New floor, concrete floor, damp course, laminate flooring.

0:25:320:25:37

All nice decoration, doors throughout, smoke alarms,

0:25:370:25:40

and you come to in here, a complete kitchen here.

0:25:400:25:43

A good upmarket kitchen, integrated appliances.

0:25:430:25:46

We've gone over the top a little bit with lighting etc underneath,

0:25:460:25:51

but when you're doing a job like this it's no big deal.

0:25:510:25:54

And, yeah, it's looking good.

0:25:540:25:55

Through the kitchen at the back,

0:25:550:25:57

the bathroom has been completely refitted with a white suite,

0:25:570:26:01

tiles and taps and there's a new pitch roof.

0:26:010:26:07

Dan views the latter with great pride.

0:26:070:26:11

Obviously building the rafters and the joists

0:26:110:26:14

and then obviously putting the felt on after

0:26:140:26:17

and across for the tiles to hook on.

0:26:170:26:20

We've finished it off now, it looks a lot neater, a lot tidier

0:26:200:26:23

and within keeping of the other houses,

0:26:230:26:26

but, you know, I'm really proud of that job. It looks really nice.

0:26:260:26:30

But, of course, the first thing that Dan had to tackle was all that woodchip wallpaper.

0:26:300:26:35

Well, nearly all.

0:26:350:26:37

The only place we've got any woodchip is on the stairs,

0:26:370:26:40

but we left that for a reason.

0:26:400:26:41

It was because it's durable if it gets any knocks.

0:26:410:26:44

But, apart from that, everywhere else has been stripped total.

0:26:440:26:48

It sounds like Dan has taken it all in his stride.

0:26:480:26:51

Well, it's just something you have to do, isn't it, really?

0:26:510:26:54

We got an industrial steamer and, you know, going into every room with it

0:26:540:26:58

and it took a couple of days, but, you know, a good scraper and a good steam and its...

0:26:580:27:03

And the whip out.

0:27:030:27:05

The whip!

0:27:050:27:07

Well, I think Kevin's joking!

0:27:080:27:11

But it sounds as though he's been a pretty hard taskmaster.

0:27:110:27:14

It certainly shows in the quality of the end result, though.

0:27:140:27:18

When you're learning a job you make mistakes

0:27:180:27:21

and Dan knows that and he certainly gets told when he does,

0:27:210:27:25

but I can see over the last six months progression

0:27:250:27:28

which is what we're after and what he should be after

0:27:280:27:31

and eventually I won't have to look over my shoulder and check his work, etc.

0:27:310:27:35

It's one of them things, if you get told what's wrong

0:27:350:27:38

you can put it right and you don't do it wrong next time,

0:27:380:27:41

so it's good experience.

0:27:410:27:42

It's like free training, really.

0:27:420:27:44

He should be paying me!

0:27:440:27:46

Hmm...Somehow I don't think Dan will go for that idea,

0:27:500:27:53

but the experience he's gained here will certainly come in handy.

0:27:530:27:57

It's been a real family project because younger son Matt has also had a hand in the plumbing.

0:27:570:28:02

He's been here two and three days a week.

0:28:020:28:04

He's done a bit of plumbing, but he's also got his hands dirty

0:28:040:28:07

and doing a bit of labouring work and helping in and mucking in

0:28:070:28:10

which is what we all do, you know?

0:28:100:28:11

-It isn't just doing your trade, is it?

-Yeah.

0:28:110:28:14

It's doing the lot, really, when you're doing this project.

0:28:140:28:17

Although Kevin originally budgeted 8,000 to 10,000 to do all the work,

0:28:170:28:22

the final figure, including his other fees, is just over 13,000.

0:28:220:28:26

That takes the total spend,

0:28:260:28:28

including the £54,500 purchase price, up to around 68,000.

0:28:280:28:32

So, what will it be worth?

0:28:320:28:36

I've invited two local estate agents

0:28:410:28:43

to take a look at this refurbishment project

0:28:430:28:46

and it seems as though Kevin and Dan's hard work

0:28:460:28:49

is being well received.

0:28:490:28:50

Wow! It was a really, really smashing job

0:28:500:28:53

in a relatively short space of time. I'm most impressed.

0:28:530:28:57

I think they've done a fantastic job on this property.

0:28:570:29:00

They've specced it up to a really high spec.

0:29:000:29:02

Good finish throughout.

0:29:020:29:03

I think they've put a lot of time and attention on this property.

0:29:030:29:07

For example, in the kitchen they've put the detail in,

0:29:070:29:09

they've put in under lighters underneath the wall units,

0:29:090:29:12

they've put pelmet lighting, integrated pelmet lighting which is quite a nice feature.

0:29:120:29:17

And the appliances look as if they're a little more than the basic ones,

0:29:170:29:21

so it's nice to see that somebody's taken the time to think it through and put a bit more detail in it.

0:29:210:29:26

But have they spent too much?

0:29:260:29:29

Remember, Kevin's total costs were around £68,000.

0:29:290:29:35

In today's current market I would value this property at £69,500.

0:29:350:29:40

In the market that we're in we're really topping out at 69,950,

0:29:400:29:44

but I have to say I would be really tempted to push this a little further

0:29:440:29:48

because of some of the detail that's been added that I don't normally see.

0:29:480:29:53

I would be suggesting an asking price on this property of somewhere in the region of 72,000.

0:29:530:29:59

So, this father and son team could only make a pre-tax profit

0:29:590:30:05

of between £1,500 and £4,000.

0:30:050:30:08

It's a little bit lower than I thought, but the market does reflect it at the moment.

0:30:080:30:13

I mean, they were selling in the mid 80s in this street a couple of year ago.

0:30:130:30:16

Kevin's plan always was to rent this place out, at least in the short term.

0:30:160:30:22

For the condition of this property,

0:30:220:30:24

I believe you would charge a premium at 410 per calendar month.

0:30:240:30:27

Generally speaking, £425 per calendar month

0:30:270:30:31

should be achievable easily on this property.

0:30:310:30:34

Those figures would give Kevin a return of around 7.5% on his £68,000 investment.

0:30:350:30:42

Not bad, but there's even better news because they've already got a tenant lined up.

0:30:420:30:48

We got people knocking on the door asking what we were doing with it

0:30:480:30:51

and before I knew it we got people who were really interested,

0:30:510:30:55

and in the end we've secured a nice mature couple

0:30:550:30:58

who I think will blend in well with the neighbours,

0:30:580:31:00

which is a big thing for me as well,

0:31:000:31:02

and the rent will be more than what we've basically just been told

0:31:020:31:06

so it all sounds good in that respect.

0:31:060:31:08

I'm quite happy with the end result.

0:31:080:31:10

With this development out of the way,

0:31:140:31:17

Kevin has already turned his attention to two more,

0:31:170:31:20

so it's just as well that he'll have Dan and soon Matt to help out.

0:31:200:31:25

This is Roundhay, an affluent suburb of Leeds,

0:31:320:31:35

and the name Roundhay comes from originally round hog

0:31:350:31:39

which basically means round hunting enclosure or deer park,

0:31:390:31:44

but I'm hunting for bargains.

0:31:440:31:47

What a great place to start!

0:31:470:31:50

This area was once hunting land belonging to the de Lacy family of nearby Pontefract Castle.

0:31:500:31:56

Later it became first mining and then farming land.

0:31:560:32:00

Today Roundhay Park is one of the largest city parks in Europe.

0:32:000:32:06

So, not surprising this is a very desirable area

0:32:060:32:10

and the houses round here reflect that.

0:32:100:32:12

They're gorgeous, very individual.

0:32:120:32:15

So when you hear about a three-bedroom semi-detached

0:32:150:32:19

which had a guide price of 130,000 quid,

0:32:190:32:21

oh, yes, it's time to get excited!

0:32:210:32:23

And, you know what? From the outside this place looks pretty good.

0:32:230:32:30

Those bay windows give it great character and there are some lovely details on the other windows, too.

0:32:300:32:36

Yes, the woodwork needs attention and that might not come cheap, but it's still a fantastic property.

0:32:360:32:41

Let's find out if the inside matches up.

0:32:410:32:45

So, what have we got? Well, you know what?

0:32:470:32:50

I'm a great believer in first impressions and I like this place.

0:32:500:32:54

I like the light in this hall area,

0:32:540:32:56

lots of windows and the stained glass is quite cute.

0:32:560:32:59

It's a fairly standard layout.

0:32:590:33:01

We've got stairs up to the bedrooms there and this large hall area,

0:33:010:33:04

though, gives it a really nice sort of non-cramped feel.

0:33:040:33:07

Front room there, fireplace, big bay window which, again, gives a really good feel to it.

0:33:070:33:12

Kitchen, wow! OK.

0:33:120:33:13

Yep, that's going to need a bit of work, but, you know what?

0:33:130:33:17

You could put your own stamp on that and, you know,

0:33:170:33:19

make a huge difference as we know in terms of the value of the house.

0:33:190:33:23

And then this rear sitting room, it's a good sized space.

0:33:230:33:26

Again, an open fire there which is good. But look at this, fantastic!

0:33:260:33:30

Somebody's already got big doors out on to the garden.

0:33:300:33:33

Obviously they need replacing, but all the structural work's been done.

0:33:330:33:37

It's a great house.

0:33:370:33:40

Out at the back there's a good-sized garden, too.

0:33:400:33:42

Plenty of room for kids to play with space left over.

0:33:420:33:46

That gives me an idea.

0:33:460:33:48

I think this house would really benefit from exactly what the next door neighbours have done.

0:33:500:33:55

Stick a conservatory on the back and it would give you that extra space.

0:33:550:33:58

Now, this is a perfect family home, so that could be a kids' play area

0:33:580:34:02

or just somewhere to come out and enjoy the garden.

0:34:020:34:04

It's not going to cost too much and it would really enhance the house.

0:34:040:34:08

While we're about it, you can see that the neighbours have also added

0:34:080:34:13

a dormer loft conversion, presumably to create a fourth bedroom.

0:34:130:34:17

Time to find out what's upstairs, I think.

0:34:170:34:22

You know, the thing that really strikes me about the house

0:34:220:34:25

isn't necessarily the rooms,

0:34:250:34:26

it's the hallway and the landing areas here.

0:34:260:34:29

They're very big, which you could argue is a bit of a waste of space,

0:34:290:34:32

but I think it gives the whole house a lovely open feel.

0:34:320:34:35

It's fantastic. I mean, things like this on the staircase.

0:34:350:34:38

Look at this beautiful stained glass window.

0:34:380:34:41

And you do need to replace all the windows,

0:34:410:34:43

but whatever you can do to keep features like that it's got to be done.

0:34:430:34:47

But what have we got up here?

0:34:470:34:48

Well, three bedrooms, reasonable size.

0:34:480:34:50

One fairly small one, but two good sized doubles.

0:34:500:34:53

And then we've got a bathroom and separate loo.

0:34:530:34:56

Now, there's a big debate,

0:34:560:34:57

do you knock those two together to create one room?

0:34:570:35:00

I say not. This is a family house and, really, if you've got a family,

0:35:000:35:04

it's great to have a separate loo and a separate bathroom.

0:35:040:35:07

Oh, dear.

0:35:090:35:10

Right, now, the whole house, as you can tell,

0:35:100:35:13

is in need of redecoration.

0:35:130:35:15

That is not a problem, but that potentially is.

0:35:150:35:19

Now that, as far as I can tell,

0:35:190:35:21

is a lath and plaster ceiling and it's cracked, as you can see.

0:35:210:35:26

Now, my big concern is whether or not

0:35:260:35:28

that's because there's been some water ingress above it.

0:35:280:35:31

There is only one way to find out.

0:35:310:35:34

This could be messy.

0:35:340:35:36

Yep, well, that needs sorting out, doesn't it?

0:35:390:35:45

Oops! Well, there's definitely some work to do on that ceiling,

0:35:460:35:50

especially now!

0:35:500:35:51

I just hope that the roof above is watertight,

0:35:510:35:54

otherwise it's one more thing to add to the list here.

0:35:540:35:57

What will a local estate agent make of this as an investment project?

0:35:570:36:02

It's a very run-down property

0:36:040:36:06

which is in need of some large modernisation,

0:36:060:36:08

gas central heating, new bathroom suites,

0:36:080:36:11

new fitted kitchens, a rewire and double glazing.

0:36:110:36:14

And probably a new damp course, too, all of which will set you back

0:36:140:36:18

somewhere in the region of £20,000 to £30,000.

0:36:180:36:21

Add that to the £130,000 guide price

0:36:210:36:24

and you're looking at a total investment of at least 150,000,

0:36:240:36:28

but it could be well worth it.

0:36:280:36:31

It would stand in the region of £269,000.

0:36:320:36:35

That could mean around £100,000 profit

0:36:350:36:38

if you picked it up at the guide price.

0:36:380:36:41

With rental values in the region of £750 per calendar month,

0:36:410:36:46

you could also make a decent return on this if you let it out.

0:36:460:36:50

So, there you have it.

0:36:520:36:54

Now, have I taught you enough over the years

0:36:540:36:57

of Homes Under The Hammer

0:36:570:36:58

for you to know this is an absolutely fantastic opportunity?

0:36:580:37:01

Great location, wonderful house.

0:37:010:37:04

Yes, it needs a bit of cosmetic sorting out, kitchen, bathroom,

0:37:040:37:07

yadda, yadda, yadda, not a problem,

0:37:070:37:09

and for a guide price of 130,000 quid

0:37:090:37:11

this was a fantastic opportunity.

0:37:110:37:13

Who spotted it at the auction?

0:37:130:37:15

Lot number 80 is 20 Keddlestone Road in Leeds 8.

0:37:170:37:20

The vacant three bedroom semi-detached house

0:37:200:37:23

in need of renovation.

0:37:230:37:24

£130,000 to start things off?

0:37:240:37:27

120 then, may I say? 120?

0:37:270:37:31

Thank you, sir, 120 opening bid. I'll take yours. 120. 121.

0:37:310:37:34

It's £120,000 then we have.

0:37:340:37:37

121 I'm looking for. 121, thank you, madam. 122, then.

0:37:370:37:40

122. 123. 124.

0:37:400:37:43

124. 125. 126. A brand new bidder.

0:37:430:37:46

Thank you, sir. 126. 127. 127. 128.

0:37:460:37:50

129? 130.

0:37:500:37:53

131. 132.

0:37:530:37:54

133. 134. 135. No? Shakes the head.

0:37:540:37:59

It's 134. Gentleman seated, it could be yours, sir. 135 anywhere else?

0:37:590:38:03

Are we all done then at £134,000? Sorry, madam, didn't see you.

0:38:030:38:07

135, then we have seated.

0:38:070:38:10

136 anywhere else?

0:38:100:38:12

It's 100... 136. And lady is back in.

0:38:120:38:14

136. 137. 138.

0:38:140:38:17

£137,000 then we have.

0:38:170:38:20

138 anywhere else? All done then at 137?

0:38:200:38:24

138, she's back in.

0:38:240:38:25

I thought you might. 138. 139?

0:38:250:38:29

139. And 140, round it up. 140. 140 she's got. 141 then?

0:38:290:38:32

140. No? £140,000 and we have the lady at the back.

0:38:320:38:36

Are we all done then at £140,000?

0:38:360:38:39

I'll sell it to her then at 140.

0:38:390:38:42

For the first time at 140.

0:38:420:38:44

Second time.

0:38:440:38:47

Third and final time. Fair warning. Thank you, madam.

0:38:470:38:50

Well done.

0:38:500:38:52

I'm surprised it took so long for this one to get going, but the new owners must be delighted.

0:38:520:38:57

For a bid of 140,000, just £10,000 over the guide price,

0:38:570:39:02

Lakvia and Santok have picked up a bargain, I reckon.

0:39:020:39:07

Although they're both originally from India,

0:39:070:39:09

Santok has been living in the UK since he was eight years old.

0:39:090:39:13

He moved to Leeds 26 years ago when the couple got married

0:39:130:39:16

and they've been buying property to rent ever since.

0:39:160:39:19

I met up with them at the house to hear about their plans.

0:39:190:39:22

Santok, Lakvia, lovely to meet you both.

0:39:250:39:27

I love this house! Why did you want to buy it, apart from the blindingly obvious that it's fab?

0:39:270:39:32

Well, we just wanted to grow our business.

0:39:320:39:35

We were looking for another investment, so we went to buy,

0:39:350:39:38

really, another house on the auction that day, than we thought,

0:39:380:39:42

"Well, we'll have a look at this one,"

0:39:420:39:45

because one of my architects pointed out to us this could be a good buy.

0:39:450:39:49

Although they didn't see the inside of the property before the auction,

0:39:490:39:53

Santok did check the outside and, crucially,

0:39:530:39:56

the property values in the area.

0:39:560:39:59

They also had their architect's advice to go on, so they were happy

0:39:590:40:03

to bid up to £150,000 on auction day if necessary.

0:40:030:40:07

So, having seen it inside, what do you think?

0:40:070:40:11

Well, we think it's not too bad.

0:40:110:40:13

We've bought a few houses before, they're worse, you know?

0:40:130:40:17

One house, we bought it, there was no bath in the bathroom.

0:40:170:40:21

The bath in the kitchen!

0:40:210:40:23

Yeah!

0:40:230:40:24

When it comes to developing, Santok and Lakvia are old hands.

0:40:250:40:30

They have around 20 properties they rent out,

0:40:300:40:32

including four shops and a number of flats and houses.

0:40:320:40:35

But more recently they've also bought a pub which they now run.

0:40:350:40:39

So, Santok is a landlord in more ways than one!

0:40:390:40:43

And some of his locals even do building work for him.

0:40:430:40:47

I employ different people, joiners, brickies, we've got a few come in the pub they do building work for me.

0:40:510:40:58

-Before they've had a drink, hopefully.

-Yeah, yeah!

0:40:580:41:01

Well, they always work before!

0:41:010:41:03

So, tell me exactly what you're going to do with the place.

0:41:030:41:06

Well, we're going to put the central heating,

0:41:060:41:09

brand new central heating in. Kitchen, new, and a bathroom.

0:41:090:41:12

-Bathroom, we may knock the toilet, you know, the toilet is separate.

-Yes.

-We'll knock it all in one.

0:41:120:41:16

-Really?

-Because I don't think there's a bath in there,

0:41:160:41:19

you know, there's just a shower? So it needs a proper bathroom.

0:41:190:41:22

I see Santok's point, but I think with a bit of adjustment,

0:41:220:41:26

it would be possible to get a bath in here

0:41:260:41:29

and still have a separate toilet.

0:41:290:41:31

Then in terms of the rest of the house?

0:41:310:41:33

Then we're going to redecorate the whole lot,

0:41:330:41:36

plaster the ceilings wherever needs it.

0:41:360:41:38

Yes, there might be a bit of a hole in one of the ceilings,

0:41:380:41:41

-I don't know how that happened, but...

-Well...

-Sorry.

0:41:410:41:44

-It doesn't matter.

-I thought I'd better come clean about that.

0:41:440:41:47

We'll send you the bill later!

0:41:470:41:49

Ah, well, moving swiftly on!

0:41:490:41:52

Santok and Lakvia also have plans to add a small extension to increase

0:41:520:41:56

the size of the dining room and possibly a dormer at a later date.

0:41:560:42:00

I'm not sure it's the best option in the current climate,

0:42:000:42:03

but the couple are planning to hold on to this property in the long term,

0:42:030:42:08

so it may add more value by then.

0:42:080:42:10

They've set themselves a £10,000 budget and an eight-week timescale to do all the work here.

0:42:110:42:16

It's not much, but Santok will be doing a lot of it himself if he can take time off from running the pub.

0:42:160:42:22

So, Santok and Lakvia are securing themselves a great house for 140,000 quid.

0:42:250:42:30

See, you've got to get yourself down to the auctions.

0:42:300:42:33

I'm a little bit concerned about what they're going to do

0:42:330:42:36

in terms of knocking the bathroom and toilet together,

0:42:360:42:39

I don't think that's the right thing to do.

0:42:390:42:42

And, I have to say, over the next few months

0:42:420:42:44

I think a bill might be arriving on my doormat for that ceiling repair.

0:42:440:42:47

Find out what happens later in the show.

0:42:470:42:50

Well, months have passed.

0:42:530:42:55

Have our purchasers' plans hatched?

0:42:550:42:57

-Have they built up a nice little nest egg or have they had rotten luck?

-Let's go back and find out.

0:42:570:43:02

When friends Neil and Keith decided to embark

0:43:040:43:07

on a property developing partnership together

0:43:070:43:10

they chose a real challenge to get them started.

0:43:100:43:14

This three-bed mid terrace house in Gosport had been empty for so long

0:43:140:43:18

that the roof in the rear extension had completely given way.

0:43:180:43:23

The one over the bay at the front was rapidly following it.

0:43:230:43:27

It was full of clutter and there were signs of a rat problem,

0:43:270:43:30

but Neil and Keith still paid £82,500

0:43:300:43:34

for this unmortgageable property at auction.

0:43:340:43:38

They planned to spend another 20,000 to 25,000 to return it to its former glory.

0:43:380:43:44

They'd set themselves a three month target to do all the work,

0:43:440:43:48

but nearly nine months later

0:43:480:43:50

the house is only just nearing completion.

0:43:500:43:53

So, why the delay?

0:43:530:43:54

The weather wasn't particularly good over the winter.

0:43:540:43:57

We didn't really have a tight timeline.

0:43:570:43:59

Keith was working on sites around the country

0:43:590:44:02

and so what we've done is let time go on a little bit

0:44:020:44:05

and we started as the spring come along

0:44:050:44:07

and the warmer weather come along

0:44:070:44:09

and we've actually now started to enjoy it.

0:44:090:44:12

It's very hard to work in a cold, empty house.

0:44:120:44:14

This place had been empty for so long

0:44:140:44:17

that the gas and electrics were no longer connected.

0:44:170:44:21

The guys had to have the road closed outside in order to get a new gas meter installed.

0:44:210:44:27

Even now they still have a few days to wait

0:44:270:44:29

until a registered plumber can come

0:44:290:44:31

and finish installing the central heating.

0:44:310:44:33

But one of the first things that had to be done was to replace the roof

0:44:330:44:37

at the back and make sure that the place was watertight.

0:44:370:44:40

Well, this is obviously the bathroom ceiling that was originally on the floor.

0:44:400:44:45

We've had a new roof put on, replaced the ceiling,

0:44:450:44:48

we've dry-lined the walls, new bathroom suite

0:44:480:44:51

and we've got a few pipe boxings to do,

0:44:510:44:54

retile it and then some floor coverings and then we'll be done.

0:44:540:44:58

With the new roof and new windows the property is finally watertight again.

0:44:580:45:03

The guys have been able to keep most of the existing brickwork here,

0:45:030:45:07

but the floors were obviously going to be a bigger problem.

0:45:070:45:11

Not only did we just take the floors up,

0:45:110:45:13

we cleared out underneath all the rafters.

0:45:130:45:16

All the beams were replaced and then new floors put down.

0:45:160:45:19

And then we started on the walls upstairs, took out a few of the walls up here, like this one.

0:45:190:45:24

All the ceilings had to be taken down because they were all lathen plaster,

0:45:240:45:27

then worked from the top downwards and as we were going,

0:45:270:45:31

putting all the new electrics in, the new central heating,

0:45:310:45:34

all the wires, all the pipes were all hidden underneath

0:45:340:45:38

the floor joists right the way down.

0:45:380:45:40

And then just worked from top to bottom pretty much.

0:45:400:45:43

They have made some small changes to the layout along the way.

0:45:430:45:46

There's a new toilet upstairs created by using some of the space in the back bedroom.

0:45:460:45:52

With the main bathroom still downstairs,

0:45:520:45:55

that's really going to help

0:45:550:45:56

and still leaves them with three good sized rooms here.

0:45:560:46:00

Don't be fooled by the table and chairs upstairs

0:46:060:46:09

because downstairs they've reinstated the dividing wall

0:46:090:46:12

in the old reception room to create a separate living and dining room.

0:46:120:46:17

They've also had to reinstall the chimneys here.

0:46:170:46:19

A couple of chimneys had been removed on the ground floor which didn't support...

0:46:190:46:24

They didn't remove them on the first floor,

0:46:240:46:26

so we've reinstated the chimneys as opposed to taking them further out,

0:46:260:46:29

give it a little bit of character.

0:46:290:46:31

In the living room the guys have integrated wiring for a TV in that chimney,

0:46:330:46:37

and they've done the same thing in almost every other room, too.

0:46:370:46:41

They intend to rent this place out

0:46:410:46:43

and have gone for a neutral but durable finish

0:46:430:46:47

hoping to maximise the rental return.

0:46:470:46:49

Of course, the kitchen is no exception.

0:46:490:46:52

Well, what we've actually done in the kitchen so far

0:46:520:46:55

is we've actually changed the cooker

0:46:550:46:57

from one side of the kitchen to the other.

0:46:570:47:00

We've had the hob and the oven reinstated with an extraction system.

0:47:000:47:04

We've taken out the washing machine from the kitchen and put a dishwasher in.

0:47:040:47:09

We've now made a utility area behind the kitchen before you go into the bathroom

0:47:090:47:13

for a washing machine and dryer with another extraction system outside,

0:47:130:47:17

and then leading into the bathroom.

0:47:170:47:19

Let's face it, this place couldn't have been much worse when Keith and Neil bought it,

0:47:190:47:25

but the guys have done great things with it which has been a huge relief to the neighbours, too.

0:47:250:47:31

For the last ten years the property was in a terrible state.

0:47:310:47:35

We had damp, we had rats, we had to call the people out from the council

0:47:350:47:39

and to see it evolve into what it is today,

0:47:390:47:42

although I know there's more work to be done, is lovely,

0:47:420:47:47

and I know all the neighbours feel the same. It's so nice to see.

0:47:470:47:52

In spite of the extra effort they've gone to here, the guys have actually stayed pretty much on budget.

0:47:520:47:58

Keith took charge of a lot of the work while Neil project managed

0:47:580:48:02

and helped out, so they've spent just under 25,000 so far.

0:48:020:48:05

They expect to go slightly over by the time they've finished.

0:48:050:48:09

Added to the original £82,500 purchase price

0:48:090:48:13

that takes the total spend up to just under 110,000.

0:48:130:48:18

But what's it now worth and did they go too far?

0:48:200:48:24

Nine months on,

0:48:320:48:33

time to find out if the market has changed significantly in Gosport.

0:48:330:48:37

What will two local estate agents

0:48:370:48:40

make of all Keith and Neil's hard work here?

0:48:400:48:42

The property is obviously a work in progress.

0:48:420:48:45

The standard is to an extremely high standard,

0:48:450:48:47

far exceeding what we usually see

0:48:470:48:49

when we go and see a renovated property.

0:48:490:48:51

Looking round the property and what they've done,

0:48:510:48:54

the improvements they've made: the kitchen, the bathroom, the upstairs toilet,

0:48:540:48:58

I can't think of anything I would have done any differently to what they've done.

0:48:580:49:02

Well, it's the first time I've seen the property

0:49:020:49:04

and first impressions are it's a nice sized home.

0:49:040:49:07

Certainly it's been refurbished to a good standard.

0:49:070:49:10

A big thumbs up for the property, then, but has all that extra effort paid off?

0:49:100:49:15

They have a tenant lined up to pay £750 per calendar month.

0:49:150:49:19

Typically properties in this area are letting for somewhere

0:49:210:49:25

in the region of £700, £725 a calendar month.

0:49:250:49:28

This may fetch a little bit more

0:49:280:49:30

because of the quality and standard of finish,

0:49:300:49:33

plus also it's, essentially, internally a new property.

0:49:330:49:36

Purely for the size and the standard of finish,

0:49:360:49:39

I would be looking between £725 and £750 per calendar month.

0:49:390:49:43

750 is what we've got, so we're happy with that, yes.

0:49:430:49:46

Neil and Keith have two weeks to get this place finished before their new tenants move in.

0:49:460:49:51

If they stay on budget then that 750 per calendar month

0:49:510:49:55

will give them an 8% return for their £110,000 investment.

0:49:550:50:00

But how much could they get if they decided to sell?

0:50:000:50:03

I would put this property on the resale market for £135,000 to £140,000.

0:50:070:50:11

I would put this poverty on the market for an asking price in the region of 139,950.

0:50:110:50:16

Although it's nice to hear that it's worth £135,000 to £140,000,

0:50:160:50:21

we're quite happy to go with the rental.

0:50:210:50:23

That top price of 140,000 would bring in about £30,000 pre tax profit,

0:50:260:50:32

so all round it's a great result for their first joint project

0:50:320:50:37

and definitely something to build on for the future.

0:50:370:50:41

Back to Roundhay in Leeds now to find out how Santok and Lakvia

0:50:450:50:50

have got on with their three-bedroom house.

0:50:500:50:53

When they bought it for just £140,000 at auction

0:50:530:50:56

I think they picked up a real bargain,

0:50:560:50:59

especially when you consider that a similar property

0:50:590:51:02

can go for 250,000 and up in this area.

0:51:020:51:05

But there was a lot to do, including that ceiling in the back bedroom.

0:51:050:51:09

Yep, well, that needs sorting out, doesn't it?

0:51:110:51:15

Well, as a pub and property landlord,

0:51:170:51:19

Santok reckoned he could get hold of all the extra labour he needed

0:51:190:51:24

to transform this place within eight weeks and for around £10,000.

0:51:240:51:29

But nine months on and when you walk up to the front of the house

0:51:290:51:33

it doesn't seem like much has changed here.

0:51:330:51:36

Slip round the back though and that scaffolding is a sure sign this place is undergoing a lot of work.

0:51:360:51:42

It appears that Santok and Lakvia have decided to add

0:51:420:51:45

that single storey extension they were considering.

0:51:450:51:48

This extension has taken us a long time

0:51:480:51:51

and the reason is a roof leak up there.

0:51:510:51:54

Now that's fixed, so there's going to be an open plan

0:51:540:51:59

kitchen and dining and living room here.

0:51:590:52:02

So, the couple have created a space that will become a new kitchen and dining area here,

0:52:020:52:07

leaving the old kitchen to be converted into a utility area,

0:52:070:52:11

but extending the property has also meant extending their schedule

0:52:110:52:15

from eight weeks to eight months.

0:52:150:52:17

Well, the project is taking its time because we have other properties.

0:52:200:52:24

Sometimes a house comes empty,

0:52:240:52:26

we break away to go and fix that to let it out straight away.

0:52:260:52:29

We've built an extension and that's taken the time.

0:52:290:52:33

Prior to that, it took three months just to get the planning permission.

0:52:330:52:37

With major structural changes planned, Santok didn't feel

0:52:370:52:40

it was worth starting on any other parts of the property.

0:52:400:52:44

There were 50 bags of cement here, you know? Tons of sand outside.

0:52:440:52:48

Then we were going to do plastering and plastering flies everywhere,

0:52:480:52:52

so that's one of the reasons

0:52:520:52:53

we didn't start decorating anywhere else.

0:52:530:52:56

But they have finally begun the rest of the work.

0:52:560:52:59

There are preparations for new central heating, electrics and...

0:52:590:53:03

the repair job on the hole in the back bedroom ceiling!

0:53:030:53:06

It's all done, yeah. All fixed, yeah. All fixed.

0:53:060:53:10

We had to paint it five times.

0:53:100:53:12

With 20 properties to rent out and a pub to run,

0:53:120:53:15

it's hard to see how Santok has found time,

0:53:150:53:18

but he has done a lot of the groundwork and woodwork

0:53:180:53:22

on the new extension himself, with Lakvia helping out.

0:53:220:53:26

That has obviously helped keep their costs down.

0:53:260:53:30

So far we've spent about, roughly, £8,000

0:53:320:53:36

and we may need about another £1,500 to do the bathroom,

0:53:360:53:40

so I think it's on... The budget is on line.

0:53:400:53:43

Wow! To put everything right in this place and get a new extension for under £10,000

0:53:430:53:49

sounds like a major achievement.

0:53:490:53:51

I'm worried that it may mean compromising on the finish

0:53:510:53:55

of this property in a good area.

0:53:550:53:57

Having said that, the couple always planned to keep this long term

0:53:570:54:01

as a nest egg for their family.

0:54:010:54:03

They have a tenant lined up

0:54:030:54:05

who's prepared to pay £700 per calendar month,

0:54:050:54:08

so their main priority is to get the place finished as quickly as possible.

0:54:080:54:13

On a total investment, including fees, of around 155,000,

0:54:130:54:17

that rental will give them approximately 5% return,

0:54:170:54:21

but is it enough for this part of Leeds?

0:54:210:54:24

What advice do two local estate agents

0:54:280:54:30

give on the work that's now underway?

0:54:300:54:33

People that buy in Leeds 8 are looking mainly for the schools,

0:54:350:54:38

but also for properties that are in good decorative order

0:54:380:54:41

that they can move straight in to.

0:54:410:54:43

It's not been carried out to a level

0:54:430:54:45

where a family would move in themselves.

0:54:450:54:47

It's been carried out so a tenant would live in it themselves.

0:54:470:54:50

It's not been fully double-glazed,

0:54:500:54:52

the chimney breasts have not been taken out.

0:54:520:54:54

I believe there will be a new bath suite fitted, new fitted kitchen.

0:54:540:54:58

For letting purposes there will be carpets,

0:54:580:55:01

plastered walls and basic rental furniture.

0:55:010:55:03

Now, that might not meet the expectations

0:55:030:55:06

of many tenants in this area,

0:55:060:55:09

but remember Santok and Lakvia have a tenant

0:55:090:55:12

ready to pay £700 per calendar month.

0:55:120:55:15

At the moment there are a lot of accidental landlords

0:55:150:55:18

because of the marketplace,

0:55:180:55:20

so the better decorative order it's in

0:55:200:55:22

the easier it will be for them to rent it out.

0:55:220:55:24

I think they could probably achieve about £800 a month

0:55:240:55:27

if it's in good decorative order.

0:55:270:55:29

The rental figures of this property would be in the region of £750 per month.

0:55:290:55:33

Well, I mean, I knew the rental values would be about 750 to 850,

0:55:330:55:37

but because the tenant we assessed he was good,

0:55:370:55:41

we said to him, "You know, what do you want to pay?"

0:55:410:55:44

So, the renovation is geared to the expectations and budget of the new tenant.

0:55:460:55:51

With all their costs to date the couple have spent around 155,000.

0:55:510:55:56

That could increase before the renovation is over,

0:55:560:55:59

but it might be worth a lot more.

0:55:590:56:01

The resale value of this property would be in the region of 270.

0:56:040:56:07

I would say the ceiling probably is 250,000.

0:56:070:56:10

So, even at the lower estimate of 250,000

0:56:100:56:13

that would still mean a profit of nearly £100,000

0:56:130:56:17

to go into the family business.

0:56:170:56:20

We paid only 140, we spent, what, about 15,000?

0:56:200:56:26

We've made a lot of money on that, you know? I think it's a bargain.

0:56:260:56:30

Me too, Lakvia. It just goes to show what you can find when you go shopping at property auctions.

0:56:300:56:36

Well, we hope we've been of help today, guiding you and maybe inspiring you along the way.

0:56:390:56:44

-See you next time for more Homes Under The Hammer.

-Goodbye.

-Goodbye.

0:56:440:56:47

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Martin Roberts and Lucy Alexander visit a two-bedroom mid-terrace in Stoke-on-Trent, a three-bedroom house in Hampshire with no roof and a semi-detached house in Leeds. All went to auction, and Martin and Lucy find out who bought them and what they paid.


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