0:00:00 > 0:00:04The financial climate may have changed beyond all recognition,
0:00:04 > 0:00:06but people are still buying property at auction
0:00:06 > 0:00:09and there are still bargains to be had.
0:00:09 > 0:00:12Yes, you may be in search of your dream home or an investment
0:00:12 > 0:00:15for your pension pot for your future years.
0:00:15 > 0:00:18Either way, there are things that will suit you perfectly
0:00:18 > 0:00:21when you buy your home under the hammer.
0:00:46 > 0:00:51You do need to know what you're doing when you buy at auction and there are lots of pitfalls.
0:00:51 > 0:00:56You could well find yourself a little gem that's a great place to live and can even make you money.
0:00:56 > 0:01:01So did today's buyers strike gold or did their dreams turn to dust?
0:01:02 > 0:01:07Coming up, in Preston, is this two bedroom below a cash machine?
0:01:08 > 0:01:10Strange hole in the wall.
0:01:12 > 0:01:16In Chatham the property that's a true Hammer Horror.
0:01:16 > 0:01:21Now this is like a house from a film set! I can't believe it!
0:01:22 > 0:01:25And a three bed house in South Wales
0:01:25 > 0:01:28where the problems aren't always visible.
0:01:28 > 0:01:32You could have a very, very nasty shock coming.
0:01:33 > 0:01:36All these properties have been sold at auction
0:01:36 > 0:01:39and we'll find out who bought them and what they paid for them
0:01:39 > 0:01:41when they went under the hammer.
0:01:44 > 0:01:47Well, today I'm in Preston.
0:01:47 > 0:01:53The place has certainly been ringing the changes since it was awarded city status in 2002.
0:01:53 > 0:01:59It's also home to one of the longest continuous rows of old fashioned telephone boxes in the country.
0:01:59 > 0:02:03# You can ring my bell
0:02:03 > 0:02:05# Ring my bell. #
0:02:05 > 0:02:08All eight of them, which line up neatly in Market Street.
0:02:08 > 0:02:11The house I'm off to see the lies two miles from Preston.
0:02:11 > 0:02:15It's interesting to note that when the planners came to name
0:02:15 > 0:02:17the streets they had a theme in mind,
0:02:17 > 0:02:20lakes in the Lake District.
0:02:20 > 0:02:22There's Windermere, Buttermere, Grasmere
0:02:22 > 0:02:25and some others further afield.
0:02:25 > 0:02:30Finally, Coniston Road and whilst I can't give you breathtaking
0:02:30 > 0:02:37scenery what I can bring you is a very reasonably priced bungalow.
0:02:37 > 0:02:41It was guided at between 65,000 and 70,000.
0:02:41 > 0:02:44A close look at the exterior gives you a good idea
0:02:44 > 0:02:47why it had such a low price for the area.
0:02:47 > 0:02:51Run down and worn out, everything about it cries out for attention.
0:02:51 > 0:02:55So does the interior match the tired exterior?
0:02:55 > 0:02:57Well, on first glance, yes.
0:02:57 > 0:03:01Oh, dear. More than just tired, that's quite serious.
0:03:01 > 0:03:03That looks a bit like subsidence,
0:03:03 > 0:03:06but odd that it's on an internal wall. And look at this.
0:03:06 > 0:03:10The floor is actually, well, it's like bowing.
0:03:10 > 0:03:15It's like... Oh, that's odd. Anyway, bathroom there.
0:03:15 > 0:03:18Obviously clearly in need of total refurbishment.
0:03:18 > 0:03:22You've got a living there, bedroom there and second bedroom here.
0:03:24 > 0:03:26I've kind of been mulling it over
0:03:26 > 0:03:30to try and figure out what's going on and I think I've got the answer.
0:03:30 > 0:03:33The clues are on the floor of one of the bedrooms here.
0:03:33 > 0:03:35If you look what's happened
0:03:35 > 0:03:38the concrete floor here has actually buckled.
0:03:38 > 0:03:41I think what's happened is that there's an infill
0:03:41 > 0:03:42underneath the concrete floor,
0:03:42 > 0:03:46using all sorts of rubbish from local mines, whatever.
0:03:46 > 0:03:49That's reacted with the concrete and it's pushing the concrete up.
0:03:49 > 0:03:53Now that in turn is affecting the walls, so it's not subsidence,
0:03:53 > 0:03:57it's something a bit more complicated, but let me explain.
0:03:57 > 0:04:01Here we have the bungalow. Here's the roof.
0:04:01 > 0:04:04It's actually independently
0:04:04 > 0:04:08supported on the edge by the exterior walls of brick.
0:04:08 > 0:04:11Inside the property you've got the internal walls, here.
0:04:11 > 0:04:14Underneath the whole of the property is a concrete slab,
0:04:14 > 0:04:17but underneath the actual internal walls
0:04:17 > 0:04:19they've put an extra bit to add support.
0:04:19 > 0:04:23What's happened is the bits in between here and here,
0:04:23 > 0:04:26this rubbish I'm talking about, it's actually reacted with
0:04:26 > 0:04:29the concrete causing the bubbling and causing
0:04:29 > 0:04:33these walls here to crack at the top. That's the problem.
0:04:33 > 0:04:37The answer is to dig out all the floors, I'm afraid.
0:04:37 > 0:04:40No pun intended, but that could prove a real undertaking.
0:04:40 > 0:04:43If the material was used in this room chances are that it can be
0:04:43 > 0:04:49found throughout the house and the only way to solve that problem...
0:04:49 > 0:04:50# Rip it up and start again
0:04:53 > 0:04:56# Rip it up and start again. #
0:04:56 > 0:04:58The rest of the house
0:04:58 > 0:05:02carries on in the same vein and badly needs attention.
0:05:02 > 0:05:04Cracks in every wall,
0:05:04 > 0:05:08decay everywhere and the decor seems to be from another era.
0:05:08 > 0:05:11But where you really feel like you're going back in time
0:05:11 > 0:05:13is when you come into the kitchen.
0:05:15 > 0:05:17Look at this fridge.
0:05:17 > 0:05:20Absolutely fantastic!
0:05:20 > 0:05:24Authentic 1950s gas powered, I think.
0:05:24 > 0:05:27Have you ever seen anything like this before?
0:05:27 > 0:05:31Absolutely perfect. Whatever happens that must not be just thrown away.
0:05:31 > 0:05:34The kitchen itself is small, problems with the floor,
0:05:34 > 0:05:38and this is a room that definitely needs sorting out.
0:05:38 > 0:05:40Obviously all the units want to go.
0:05:40 > 0:05:43Wait a minute, what's that?
0:05:43 > 0:05:46A kind of strange hole in the wall.
0:05:48 > 0:05:50How perfect, it's a milk hatch!
0:05:54 > 0:05:58I can't see this lasting long because, as charming as it is,
0:05:58 > 0:06:02I'm afraid that nowadays this milk hatch is a bit of a security issue.
0:06:02 > 0:06:06While we're out here the garden is of a good size
0:06:06 > 0:06:09and does offer a garage, so there are some positives to this place,
0:06:09 > 0:06:14but the negatives are all inside. It's easy to see why it had that
0:06:14 > 0:06:18pretty reasonable guide price of between 65,000 and 70,000.
0:06:18 > 0:06:23I asked a local estate agent what he thought of this cracking bungalow.
0:06:23 > 0:06:26The property definitely needs a lot of work.
0:06:26 > 0:06:29It's in need of a complete refurbishment throughout,
0:06:29 > 0:06:32from top to bottom, and there's quite a lot of work to undertake
0:06:32 > 0:06:35over quite a period of time, I would imagine.
0:06:35 > 0:06:37The positives with the property are that
0:06:37 > 0:06:41it's in a good residential area, it has good facilities nearby,
0:06:41 > 0:06:42including shops and schools.
0:06:42 > 0:06:46It also has good access to the city centre and the motorway.
0:06:46 > 0:06:50Let's talk figures. How much could someone make here?
0:06:50 > 0:06:54When renovated, I think the property could come on to the market
0:06:54 > 0:06:56at a figure in the region of £125,000.
0:06:56 > 0:07:00The rental per calendar month for this property would be in the region
0:07:00 > 0:07:02of about £500 to £525 per month.
0:07:03 > 0:07:06This house may well be stuck in a time warp,
0:07:06 > 0:07:08but it's going to take more than
0:07:08 > 0:07:11a "jump to the left" and a "step to the right" to sort it out.
0:07:11 > 0:07:15Let's see who fancied taking on the challenge at the auction.
0:07:18 > 0:07:23Lot 129 is 160 Coniston Road in Ford.
0:07:23 > 0:07:27Can we get going at 40? 40 anywhere. 40 I've got.
0:07:27 > 0:07:2945,000 I'm looking for, then.
0:07:29 > 0:07:32Further on my left 45 I've got. 50,000?
0:07:32 > 0:07:3650 I've got. 55. And I've got it.
0:07:36 > 0:07:3860,000, then. I've got it.
0:07:38 > 0:07:4265. 65,000 in the room I've got.
0:07:42 > 0:07:4670,000 at the back. 75,000, then. 80,000 I've got?
0:07:46 > 0:07:4985,000 then, sir.
0:07:49 > 0:07:53Two. 82,000. 84,000.
0:07:53 > 0:07:5886. 85 I'll take. 86, then.
0:07:58 > 0:07:5987.
0:07:59 > 0:08:04It's with you then, sir, at the back at 86,000, far left hand side.
0:08:04 > 0:08:07Any more bids? That's 86,000.
0:08:07 > 0:08:10I'm going to sell it at 86,000. Where are we pointing?
0:08:10 > 0:08:14New bidder on my right, so 87,000 right at the far back.
0:08:14 > 0:08:16We've got 88 there.
0:08:16 > 0:08:2089,000. Looking for 90,000.
0:08:20 > 0:08:2390,000 we've got. 91?
0:08:24 > 0:08:2991 we've got. 92. It's back with you then, sir, at 91,000.
0:08:29 > 0:08:32Are we all done at 91,000?
0:08:32 > 0:08:34For the first time, then.
0:08:34 > 0:08:39Second time. At 91,000 for the third and final time, then.
0:08:39 > 0:08:41Sold to you, sir. Paddle number 474.
0:08:43 > 0:08:47The buyer of the lot was local man, Anthony.
0:08:47 > 0:08:53He got the bungalow for £91,000, £21,000 over the guide price.
0:08:53 > 0:08:56I met him at the property to find out what his plans were.
0:09:00 > 0:09:03- Anthony, very good to meet you. - Nice to meet you.
0:09:03 > 0:09:05- An interesting property? - It's got its points.
0:09:05 > 0:09:07Which points stood out for you?
0:09:07 > 0:09:10Quaintness. The fact that it's aged.
0:09:10 > 0:09:12The fridge, for want of a better word!
0:09:12 > 0:09:16You'd almost like to leave it as an example of 1950s design.
0:09:16 > 0:09:20You can tell it's aged, but there's no ageless character, is there?
0:09:20 > 0:09:25- Correct. Apart from the kitchen. - Apart from the kitchen.
0:09:25 > 0:09:29- We might leave it exactly as it is, I don't know yet!- You think so?- No!
0:09:29 > 0:09:32Well, there's one early victim of Anthony's renovation plans,
0:09:32 > 0:09:37but I reckon the bungalow's in good hands as he runs a roofing business,
0:09:37 > 0:09:40so the scale of the renovation needed here shouldn't faze him.
0:09:40 > 0:09:44We do do properties up occasionally and with the modern day climate
0:09:44 > 0:09:48a couple of lads are a bit quiet so rather than pay them to do nothing
0:09:48 > 0:09:51I'll pay them to do this up and hopefully make a couple of shillings.
0:09:51 > 0:09:54- Is this the kind of thing you've done before?- A few times, yes.
0:09:54 > 0:09:58Me and the missus, we've quite a few properties on rent so
0:09:58 > 0:10:00it's a retirement thing, but I never seem to retire.
0:10:00 > 0:10:04I'll retire when I'm 40 and I'm nearly 50, and I said I'm going
0:10:04 > 0:10:06to retire when I'm 50, but I might get to 60 or 70 yet.
0:10:06 > 0:10:11You obviously enjoy it because otherwise you wouldn't do it.
0:10:11 > 0:10:14I do. When you get into them they're quite good, enjoyable, different.
0:10:14 > 0:10:17- Few arguments with the missus over them.- Arguments?
0:10:17 > 0:10:21I wouldn't say we've come to blows, but we've had heated arguments
0:10:21 > 0:10:25in the past over properties and what they should be left like
0:10:25 > 0:10:28and what we're going to do and the setup and all that thing.
0:10:28 > 0:10:32I seem to get my way eventually, but after a few arguments.
0:10:32 > 0:10:34And sometimes she gets her way, as well.
0:10:34 > 0:10:37With a portfolio of 14 properties under their belts,
0:10:37 > 0:10:41it sounds like Anthony and his wife have the right chemistry
0:10:41 > 0:10:43to build up their pension pot.
0:10:43 > 0:10:46Anthony has spent some time in the army,
0:10:46 > 0:10:50so should be qualified to get this place into fighting shape.
0:10:50 > 0:10:54He plans to create a bigger kitchen by stealing space from the bathroom.
0:10:54 > 0:10:58That will become a shower/wet room while the living room
0:10:58 > 0:11:00and bedrooms will stay as they are.
0:11:00 > 0:11:02That leaves the big battle with the floors.
0:11:02 > 0:11:06This age of property they're probably on a thick piece of concrete
0:11:06 > 0:11:09underneath the floor or the floor in one slab
0:11:09 > 0:11:12and it's reacted and lifted and going then it's probably that.
0:11:12 > 0:11:16That is why the walls have dropped because the roof is independently
0:11:16 > 0:11:19supported and effectively the roof's not dipped.
0:11:19 > 0:11:22The outside walls haven't dipped, just the inside,
0:11:22 > 0:11:25which damn near crying out that that is the reason why,
0:11:25 > 0:11:28but until you get the floor up you don't know for sure.
0:11:28 > 0:11:31Anthony seems very relaxed about the potential problems
0:11:31 > 0:11:33this floor could present.
0:11:33 > 0:11:36If it all goes according to plan he thinks the renovation
0:11:36 > 0:11:38will cost no more than £20,000
0:11:38 > 0:11:42and that he'll have it turned round in two to three months.
0:11:42 > 0:11:46I was keen to know what the future was for that retro fridge.
0:11:46 > 0:11:49We're going to put it on eBay and see what we can get for it.
0:11:49 > 0:11:52Because you couldn't buy one if you wanted one, effectively.
0:11:52 > 0:11:56There's probably some film or drama company who's trying
0:11:56 > 0:11:59to recreate a 1950s house that would go, wow, that is just perfect!
0:11:59 > 0:12:04It probably is. You never know. There's always someone who wants it.
0:12:04 > 0:12:08The art is matching the people who want it with the people who's got it.
0:12:08 > 0:12:10Absolutely. And the milk hatch?
0:12:10 > 0:12:12I'm afraid it's not long to live.
0:12:12 > 0:12:16It's a real shame, but I bet in its day it was quite a thing, was it?
0:12:16 > 0:12:19It was, apparently, I was talking to the old ladies next door,
0:12:19 > 0:12:23It was an optional extra, an optional extra when they built the house.
0:12:23 > 0:12:25Not all the houses in the row have them,
0:12:25 > 0:12:28only the ones who wished to have them, you see?
0:12:28 > 0:12:32I think it's going to go. It's on its last days, unfortunately.
0:12:32 > 0:12:33# No milk today
0:12:33 > 0:12:35# It wasn't always so. #
0:12:35 > 0:12:39It looks like this milk hatch has finally exceeded its expiry date.
0:12:39 > 0:12:42It's no wonder the condition of the bungalow
0:12:42 > 0:12:44leaves a sour taste in the mouth
0:12:44 > 0:12:49because, as Anthony discovered from the neighbours,
0:12:49 > 0:12:51it's been empty for 46 years.
0:12:51 > 0:12:54What do they think about the place being sorted out?
0:12:54 > 0:12:57They're happy, because it is a little bit of an eyesore,
0:12:57 > 0:13:01so they're happy that eventually, although they're going to have to
0:13:01 > 0:13:05go through a bit of muck and rubbish before it's finished,
0:13:05 > 0:13:09but that it's going to be sorted out, look a bit neater and brought back
0:13:09 > 0:13:12into use because it's wasted as it is, isn't it?
0:13:12 > 0:13:15Good luck with it. I hope you don't have too many arguments
0:13:15 > 0:13:19with the wife over things, but do let us know how it all goes.
0:13:19 > 0:13:22I'll try not to, but we'll see, we'll see.
0:13:25 > 0:13:27Well, after a long wait
0:13:27 > 0:13:33it looks like the bungalow is going to get a much needed makeover.
0:13:33 > 0:13:34Sadly, the old milk hatch is going,
0:13:34 > 0:13:38but the fridge will end up somewhere, probably in a museum.
0:13:38 > 0:13:39Anthony's got his work cut out,
0:13:39 > 0:13:42but I'm sure he's got the skills to make it happen,
0:13:42 > 0:13:45but how's he going to get on in the arguments with his wife?
0:13:45 > 0:13:48You can find out later in the show.
0:13:53 > 0:13:55The next property is in Kent.
0:13:55 > 0:13:59It's between the historic Medway towns of Chatham and Gillingham
0:13:59 > 0:14:02on the busy Capstone Road. I'm keen to see if this is
0:14:02 > 0:14:06going to be an ugly duckling or more of an elegant swan.
0:14:08 > 0:14:14Now, the first thing I notice walking up to this house is the noise and the traffic.
0:14:14 > 0:14:17You're just off the extremely busy A2 and I feel like I'm in
0:14:17 > 0:14:21the middle of a roundabout because there's cars just whizzing past me!
0:14:21 > 0:14:25Do you know what? It's not even rush hour at the moment.
0:14:25 > 0:14:27It's not making a great first impression.
0:14:27 > 0:14:30I've got my fingers crossed that Hopewell House,
0:14:30 > 0:14:35with a guide price of £280,000 to £300,000 will make a better one.
0:14:37 > 0:14:38Oh, my goodness!
0:14:40 > 0:14:42Maybe not!
0:14:43 > 0:14:48From the road it's obvious that this house really is in a terrible state.
0:14:48 > 0:14:50The auction catalogue has an ominous warning,
0:14:50 > 0:14:56"use extreme caution when viewing", so I'm going to do just that.
0:14:57 > 0:15:00Now this is like a house from a film set.
0:15:00 > 0:15:02I can't believe it, it's hilarious!
0:15:02 > 0:15:05Talk about letting the daylight flood in!
0:15:05 > 0:15:09There's no roof, no floors, nothing. If you look closely,
0:15:09 > 0:15:13you can see signs that it may once have been a handsome home,
0:15:13 > 0:15:17but all there is now is burnt timbers and rubble everywhere.
0:15:17 > 0:15:22It's quite sad to see a house just destroyed in such a way,
0:15:22 > 0:15:25but as a developer I've made my decision.
0:15:25 > 0:15:30This isn't a renovation project, it's a demolition job.
0:15:30 > 0:15:32# I'm going down, down, down, down
0:15:32 > 0:15:36# I'm going down, down, down, down. #
0:15:36 > 0:15:39It must have been quite a fire to destroy a house this size.
0:15:39 > 0:15:42Restoring a building like this would definitely
0:15:42 > 0:15:44burn a hole in your pocket.
0:15:44 > 0:15:49Unfortunately, it could be the sort of project that would bring little
0:15:49 > 0:15:52or no return on your investment, but it's not all doom and gloom.
0:15:52 > 0:15:56Round the back, it's quite clear the opportunities
0:15:56 > 0:15:58don't lie with the house itself.
0:15:58 > 0:16:00It's the fact that this site is being sold
0:16:00 > 0:16:05with planning permission to raze the existing house to the ground
0:16:05 > 0:16:08and build a terrace of five three bedroom properties.
0:16:08 > 0:16:10Now, that has got you listening, hasn't it?
0:16:10 > 0:16:18With this fantastic quarter of an acre plot I'm much more hopeful about Hopewell House.
0:16:18 > 0:16:22The garden may be overgrown and neglected, but it's easy to see
0:16:22 > 0:16:26that it's great size does offer real potential for that new development.
0:16:26 > 0:16:29Even if it could be rescued, it's highly unlikely anyone
0:16:29 > 0:16:34would pay top dollar for a grand detached house on such a busy road.
0:16:34 > 0:16:39So developing those five homes could prove the best way forward.
0:16:39 > 0:16:42The plans show there's plenty of additional space
0:16:42 > 0:16:44that could be used for a sixth home.
0:16:44 > 0:16:48The big drawback is that in the currently troubled property market
0:16:48 > 0:16:52investing in new builds can be a risky business.
0:16:54 > 0:16:58With the lot guided at £280,000 to £300,000
0:16:58 > 0:17:00it's time to ask a local estate agent
0:17:00 > 0:17:04what she thinks of the site and its potential.
0:17:07 > 0:17:11The plans that have been passed could be better developed.
0:17:11 > 0:17:14There's an awful lot of space round the houses that is wasted.
0:17:14 > 0:17:16In this current market I believe
0:17:16 > 0:17:20it would be far better to build flats rather than houses,
0:17:20 > 0:17:22especially retirement as people
0:17:22 > 0:17:24are coming down into smaller units.
0:17:24 > 0:17:27And also I think if the properties do stick
0:17:27 > 0:17:31then rental is far better on flats than it is on the house market.
0:17:31 > 0:17:33So let's talk figures.
0:17:33 > 0:17:36What's the possible return here?
0:17:36 > 0:17:40I believe, in the current market, for the three bedroom townhouses
0:17:40 > 0:17:43we should be able to achieve somewhere in the region
0:17:43 > 0:17:47of £200,000 and possibly a little more for the end ones.
0:17:47 > 0:17:52That could make this five house development worth over £1 million.
0:17:52 > 0:17:54What could the rental figures be?
0:17:54 > 0:17:57I would have thought that we would
0:17:57 > 0:18:00be looking at around 800 to 850 per calendar month.
0:18:03 > 0:18:06With the plans all ready to go,
0:18:06 > 0:18:11it's not hope value we've got here, but real potential profit.
0:18:11 > 0:18:14This site isn't without its difficulties and the road will
0:18:14 > 0:18:17always be an issue, but I think it's a good opportunity.
0:18:17 > 0:18:20Let's see who got fired up at the auction.
0:18:23 > 0:18:28Lot 103 now, which is Hopewell House at Capstone Road in Chatham.
0:18:28 > 0:18:31Where are you going to start me, 270?
0:18:31 > 0:18:34270? I'm on the way at the back. I think that's 260.
0:18:34 > 0:18:36£260,000 I'm bid. 260.
0:18:36 > 0:18:38At 265.
0:18:38 > 0:18:41265. I'm obliged. 265. And 70.
0:18:41 > 0:18:45And 70. And 75. And 75. And 80.
0:18:45 > 0:18:49280. At £275,000 I'm bid and 280 I'm looking for.
0:18:49 > 0:18:53Are we all done at £275,000?
0:18:53 > 0:18:55278 I think that is at the back.
0:18:55 > 0:19:00280 now, it's against you. 80 is with you. And two. 282. 282.
0:19:00 > 0:19:04On my right hand side for the first time at £280,000.
0:19:04 > 0:19:06For the second time at £280,000.
0:19:06 > 0:19:09One more time. 282, just in time.
0:19:09 > 0:19:14You can't give up there. 284. Michael, you've come all this way!
0:19:14 > 0:19:15284? 284.
0:19:15 > 0:19:22£282,000. It's with you gentlemen at £282,000 for the first time.
0:19:22 > 0:19:24For the second time at 282.
0:19:24 > 0:19:26At 282 for the third and final time.
0:19:26 > 0:19:32The hammer's up. Yours, sir, at 282,000. Well done.
0:19:32 > 0:19:35That successful bid of 282,000
0:19:35 > 0:19:40was made by business partners Paul and, well, Paul.
0:19:40 > 0:19:43Let's hope it doesn't get too confusing!
0:19:43 > 0:19:47They've been friends for years and have dabbled in renovating
0:19:47 > 0:19:50and selling small properties together.
0:19:50 > 0:19:52Their plan is to redevelop this site
0:19:52 > 0:19:55and it is by far their biggest project to date.
0:19:55 > 0:19:58I met up with them to find out more. Guys, congratulations.
0:19:58 > 0:20:02You must be so pleased that you bought this at auction.
0:20:02 > 0:20:05We think we've done a good deal for this one, looking forward to it.
0:20:05 > 0:20:08So why have you decided to buy Hopewell House?
0:20:08 > 0:20:11I've been in the area for quite some years now and the place
0:20:11 > 0:20:15has always been here in the state that it's in for at least 10 years,
0:20:15 > 0:20:19so to see it come up on the auction was an opportunity not to be missed.
0:20:19 > 0:20:22You paid £282,000 for this.
0:20:22 > 0:20:26- How much more would you have paid on the day?- We did go with a figure
0:20:26 > 0:20:28and we turned round and said the max we'd pay is 350.
0:20:28 > 0:20:32Do you enjoy buying in the auction process manner?
0:20:32 > 0:20:35- I could do that for a living.- Really? - Yeah.- Why?- I think it's brilliant.
0:20:35 > 0:20:39There is a fair bit of adrenaline that's there at the time and also
0:20:39 > 0:20:42do you actually manage to get the product that you're going for
0:20:42 > 0:20:46- at the end of the day? - Ah, the thrill of the chase.
0:20:46 > 0:20:49And, for the boys, what a great result on the price.
0:20:49 > 0:20:52It comes with planning permission, which could
0:20:52 > 0:20:56be tailor-made for this Paul. He's currently a planning manager,
0:20:56 > 0:21:00but more importantly he has project managed building developments.
0:21:00 > 0:21:03The other Paul runs a high tech manufacturing business
0:21:03 > 0:21:06for the crash repair industry.
0:21:06 > 0:21:10They both live locally, so know some of the background of this old house.
0:21:10 > 0:21:13The guy that owned it, who was an old guy,
0:21:13 > 0:21:17renovated it and shortly after there was a fault of some description
0:21:17 > 0:21:21and it burned down. In between that the squatters came in.
0:21:21 > 0:21:23- So it just wasn't meant to be?- No.
0:21:23 > 0:21:26It's quite sad. When do you plan getting the big bulldozer in?
0:21:26 > 0:21:29- Another couple of weeks, I suppose. - It's going to be quite sad.
0:21:29 > 0:21:31Yes. As you can see, it can't be rebuilt
0:21:31 > 0:21:34so it's not as if we're just taking something away.
0:21:34 > 0:21:37It's going to make the area look better, so in one sense it's sad
0:21:37 > 0:21:40but in another sense it's going to move on and move up.
0:21:40 > 0:21:44The guys are right, of course. They'll have to put sentiment aside
0:21:44 > 0:21:47and think about the potential profit when developing this site.
0:21:47 > 0:21:50It came with planning permission for five three bedroom houses,
0:21:50 > 0:21:53but we're looking to probably change that and try
0:21:53 > 0:21:57and get more smaller units on rather than three bedroom houses.
0:21:57 > 0:22:01I've got to say, it's a really big site for five houses.
0:22:01 > 0:22:04- It seems as though you could easily fit a few more on.- It is, yeah.
0:22:04 > 0:22:08It is. There was planning permission for six, but that was revised
0:22:08 > 0:22:11with the five, so we're still trying to understand why.
0:22:11 > 0:22:14It wasn't refused at six, so it might be a case of just having another
0:22:14 > 0:22:17look back at it and say we're going to put in something else,
0:22:17 > 0:22:20whether it be flats or retirement homes or it could be even
0:22:20 > 0:22:24- possibly an old people's home. - At this early stage in the project
0:22:24 > 0:22:27I think it's a good idea to be flexible.
0:22:27 > 0:22:30I do have reservations about building a large number of units
0:22:30 > 0:22:34aimed at first time buyers in these difficult times.
0:22:34 > 0:22:38But the boys do seem to have a relaxed attitude to what they've taken on.
0:22:38 > 0:22:42How many business meetings a week do you guys have?
0:22:42 > 0:22:46- We've had two so far.- Yeah. One in the pub and one in Spain.
0:22:46 > 0:22:48One before the auction I think, wasn't it?
0:22:48 > 0:22:51- We had two before the auction. - Yeah. That's about it.
0:22:51 > 0:22:54We thought, right, it's a risk, but normally the ones you
0:22:54 > 0:22:57think of less and just have a stab in the dark are the ones
0:22:57 > 0:23:00that turn out for the best, so that's what we're going to hope.
0:23:00 > 0:23:03It sounds a bit too laid back for me.
0:23:03 > 0:23:07The two Pauls plan to develop the site in nine months
0:23:07 > 0:23:10and have calculated a budget of £500,000.
0:23:10 > 0:23:13If they project manage the work themselves
0:23:13 > 0:23:16that could bring the cost down to 400,000,
0:23:16 > 0:23:20but for big build novices such as them that 100,000 saving
0:23:20 > 0:23:24could easily disappear if major problems arise.
0:23:24 > 0:23:27The project could drag beyond that schedule
0:23:27 > 0:23:31and the most important rule of developing is that time is money.
0:23:33 > 0:23:36I think time is up for Hopewell House,
0:23:36 > 0:23:40but Paul and Paul have got a great future in this exciting project,
0:23:40 > 0:23:44but will it be flats, houses or even a nursing home?
0:23:44 > 0:23:46Find out later on in the programme.
0:23:47 > 0:23:49Still to come, in Mid Glamorgan
0:23:49 > 0:23:53a three bedroom house that gets my seal of approval.
0:23:53 > 0:23:55All in all,
0:23:55 > 0:23:56yeah, not a bad start.
0:23:58 > 0:24:00How often did the two Pauls
0:24:00 > 0:24:04check on the progress of their first big development in Kent?
0:24:05 > 0:24:08Not very often. Every couple of weeks or so.
0:24:09 > 0:24:11But first, in Preston,
0:24:11 > 0:24:15did Anthony manage to drag this 1950s bungalow
0:24:15 > 0:24:17out of its time warp?
0:24:20 > 0:24:23Oh, yeah, we went back in time
0:24:23 > 0:24:27when we saw this two bedroom bungalow in Ford, near Preston.
0:24:27 > 0:24:32It had an interior which hadn't changed since the 1950s.
0:24:32 > 0:24:34Empty for 46 years,
0:24:34 > 0:24:38it was riddled with cracks and had a serious floor problem.
0:24:38 > 0:24:42It was a project that would frighten off most first time developers,
0:24:42 > 0:24:46so enter local roofer, Anthony, who bought it for £91,000.
0:24:46 > 0:24:50He's already renovated 14 properties as part of his pension plan
0:24:50 > 0:24:53and seemed just the man to take this on.
0:24:55 > 0:24:59It's been three months and the outside has had a good clean.
0:24:59 > 0:25:04There's new double glazing and new guttering so so far, so good.
0:25:06 > 0:25:10When you go inside the living room has had a great transformation,
0:25:10 > 0:25:13but look behind you.
0:25:13 > 0:25:17There's now a great open plan kitchen area
0:25:17 > 0:25:19replacing that old, tired bathroom and kitchen.
0:25:28 > 0:25:32Well, we've obviously completely revamped it, so to speak.
0:25:32 > 0:25:37All walls down, all floors up, flooring, rewire, replastered,
0:25:37 > 0:25:41new kitchen, everything, effectively, just everything really.
0:25:41 > 0:25:43It had to be done, simple as that.
0:25:43 > 0:25:45For Anthony the most pressing problem
0:25:45 > 0:25:47was to remedy that ailing floor.
0:25:49 > 0:25:53Well, this was the worst floor in the old house,
0:25:53 > 0:25:56although we did all the floors and basically we just had to take
0:25:56 > 0:26:01the old floor out, all the walls out, all the floors away,
0:26:01 > 0:26:04dig it down until we got rid of all the ash and everything
0:26:04 > 0:26:06then we decided, because we had to dig so much out
0:26:06 > 0:26:09because of the big lumps of concrete underneath,
0:26:09 > 0:26:13that we'd timber floor it and add a suspension to keep the heat in,
0:26:13 > 0:26:16we could insulate it better. We just joisted out
0:26:16 > 0:26:19to a central support wall, put the actual floorboards on top.
0:26:19 > 0:26:22When we were finishing we thought before we put the skirtings on
0:26:22 > 0:26:26we'd have a nice laminate floor all the way through the building
0:26:26 > 0:26:29and then put the skirting boards on top so it looks integral,
0:26:29 > 0:26:31part of the dirty deed, so to speak.
0:26:31 > 0:26:34But once we've dug it all out and paid for the grab bags
0:26:34 > 0:26:37and put the floor in here I worked it out it just cost me
0:26:37 > 0:26:41just a touch less than a grand and I was very, very happy because
0:26:41 > 0:26:44- I expected a lot more than that. - That's incredible!
0:26:44 > 0:26:45£1,000 to renew the whole floor!
0:26:45 > 0:26:49But with those original internal walls removed it also gave Anthony
0:26:49 > 0:26:53the chance to redesign the layout of the bungalow.
0:26:53 > 0:26:57The two bedrooms have been put back in their original positions,
0:26:57 > 0:27:01but the old hallway is now a modern stylish shower toilet area.
0:27:04 > 0:27:07With the internal layout altered so much,
0:27:07 > 0:27:11that has obviously meant things have also changed externally.
0:27:11 > 0:27:14We've had to do a bit of work on this side. This is where
0:27:14 > 0:27:17the milk hatch was and this is where the window was,
0:27:17 > 0:27:19but both of them had to go, unfortunately,
0:27:19 > 0:27:23The bricks here have come from inside, from the the internal walls,
0:27:23 > 0:27:27so they should match in a few years time once they're weathered in.
0:27:27 > 0:27:30This is where the original bathroom window was
0:27:30 > 0:27:32and here's where the original front door was.
0:27:32 > 0:27:36We've re-jigging inside so we had to re-jig outside a little bit.
0:27:36 > 0:27:39Overall I'm pretty pleased, I think we've got it roughly spot on.
0:27:39 > 0:27:42And I agree, though having the main entrance now opening
0:27:42 > 0:27:45into the kitchen may not be everyone's cup of tea,
0:27:45 > 0:27:51but at least it does create more space for the rest of the property.
0:27:51 > 0:27:56Back outside that great makeover continues with a new patio,
0:27:56 > 0:28:00French doors and double glazing. The roof's also had a good clean up.
0:28:05 > 0:28:08And the garden and garage have been tidied
0:28:08 > 0:28:11with gravel laid to hide the concrete drive.
0:28:11 > 0:28:13It's almost as if it's a new bungalow,
0:28:13 > 0:28:16but not all the fixtures and fittings went into the skip.
0:28:16 > 0:28:20The fridge is still sat in the house, waiting to go to a good home.
0:28:20 > 0:28:23I don't know if it works, but I'm not going to throw it out.
0:28:23 > 0:28:25I'm going to either sell it on
0:28:25 > 0:28:28or keep it as a bit of nostalgia or something like that.
0:28:28 > 0:28:32One person who'll be glad to say goodbye to the old bungalow
0:28:32 > 0:28:36is neighbour Joan, who's lived next door to this empty property
0:28:36 > 0:28:38- for around 20 years.- Not very nice.
0:28:38 > 0:28:41It was a bit rough and it had been broken into.
0:28:41 > 0:28:45We are all enjoying this now. Everybody in the road is enjoying it
0:28:45 > 0:28:48because they all look after their properties, don't they?
0:28:48 > 0:28:51A couple of new fantastic neighbours. Couldn't wish for better.
0:28:51 > 0:28:54They put up with all the muck, noise dust, everything.
0:28:54 > 0:28:57If you wanted a brew you just knock on the door
0:28:57 > 0:29:00and they'll bring you one. Really good neighbours.
0:29:00 > 0:29:03He's been very nice, yeah. They've been great, I have to say.
0:29:03 > 0:29:07They've kept it tidy whilst they've been doing it.
0:29:07 > 0:29:12Anthony did 90% of the renovation work and it took five weeks over
0:29:12 > 0:29:15a three month period to turn this bungalow into a decent property.
0:29:15 > 0:29:19He was called away on to other jobs which slowed his progress,
0:29:19 > 0:29:22so did that also affect his 20 grand budget?
0:29:22 > 0:29:26It was a lot cheaper than we thought, I officially thought about 20 grand.
0:29:26 > 0:29:30I've just done me sums recently. Materials and a bit of labour
0:29:30 > 0:29:32that I had to pay for has only cost me 12 and a half grand.
0:29:32 > 0:29:36I think everything took less and was quicker than anticipated.
0:29:36 > 0:29:38The first time I've been caught out that way,
0:29:38 > 0:29:41it's usually other way where it's dearer!
0:29:43 > 0:29:46It's good to see the figures going in Anthony's direction.
0:29:46 > 0:29:50He bought the bungalow for £91,000,
0:29:50 > 0:29:56so that budget of 12,500 will take his total spend to 103,500.
0:29:56 > 0:30:01Time to ask two local estate agents what they think of this property's leap into the present.
0:30:01 > 0:30:04I think the transformation is absolutely fantastic.
0:30:04 > 0:30:07The bungalow originally was in very poor condition,
0:30:07 > 0:30:10very dated and it's been transformed now into
0:30:10 > 0:30:13a very contemporary modern bungalow that would suit all sorts of buyers.
0:30:13 > 0:30:16The bungalow's been renovated to a really good standard,
0:30:16 > 0:30:19really nice finish. Very contemporary, clean.
0:30:19 > 0:30:22I like the fact that it's very contemporary, very plain.
0:30:22 > 0:30:25Even though it's a bungalow it is still very modern.
0:30:25 > 0:30:27The wooden floors are a really nice finish.
0:30:27 > 0:30:30I think the most important and the best change is taking away
0:30:30 > 0:30:33what was a very small enclosed kitchen and bring it into
0:30:33 > 0:30:36the living area which not only increases the space
0:30:36 > 0:30:39but the flexibility of the accommodation.
0:30:39 > 0:30:43Remember, this bungalow is part of Anthony's pension plans,
0:30:43 > 0:30:47- so what could he expect in rental? - I would value the property
0:30:47 > 0:30:50of a rental income of £550 per calendar month.
0:30:50 > 0:30:53The rental income that I'd recommend for this property
0:30:53 > 0:30:55would be about 550 to 575 a month.
0:30:55 > 0:30:58I think that's about right, It's in line with what we've
0:30:58 > 0:31:02already rented it out at, so I think we're right spot on-ish!
0:31:02 > 0:31:06His total spend on the property was 103,500,
0:31:06 > 0:31:10so how much could he achieve if he decided to sell?
0:31:10 > 0:31:14Recommendation for resale value of the property
0:31:14 > 0:31:16would be £135,000 to £140,000.
0:31:16 > 0:31:19If I was to put this property on the market for sale
0:31:19 > 0:31:22I would recommend an asking price of £140,000.
0:31:22 > 0:31:25That's a little bit... Touch more than I'd anticipated, really.
0:31:25 > 0:31:30Not much, but a little bit more than anticipated, so I'm happy with that.
0:31:30 > 0:31:35I'm not surprised. That's a potential pre-tax profit
0:31:35 > 0:31:40of 36,500 which must surely turn Anthony's focus away from rental.
0:31:40 > 0:31:44It's part of my pension plan, so I can't see me selling it,
0:31:44 > 0:31:46but never say never. You never know.
0:31:49 > 0:31:54Our next property is in the former mining village of Llanharan in South Wales.
0:31:54 > 0:31:58It's near Cardiff and has easy access to the M4, making it
0:31:58 > 0:32:03an ideal location for the soon to be completed film studios there.
0:32:03 > 0:32:072,000 new homes will be built here and that's not all.
0:32:07 > 0:32:10The local train station has just reopened after 40 years which
0:32:10 > 0:32:14means that Cardiff is just 12 to 14 minutes' train ride away.
0:32:14 > 0:32:16This is the property I'm here to see.
0:32:16 > 0:32:19It had a guide price of 35,000 to 41,000 quid.
0:32:19 > 0:32:21It looks all right from the outside.
0:32:21 > 0:32:25The front could do with a spruce up, but you do get UPVC units and
0:32:25 > 0:32:29the bonus of off-street parking, so there are some real positives
0:32:29 > 0:32:33for that £35,000 to £41,000 guide price. Straight away it's nice
0:32:33 > 0:32:36to have a downstairs loo, perfect for a family house,
0:32:36 > 0:32:39and this little entrance hall area does seem to have lots of space.
0:32:39 > 0:32:44It carries on when you come into the living room dining room area.
0:32:44 > 0:32:47This is a good sized room. Nice to see it's got double glazing.
0:32:47 > 0:32:49That's going to save you a few grand
0:32:49 > 0:32:53in terms of having that put in if it didn't have it, which it does.
0:32:53 > 0:32:57A nice set of sliding doors out on to the garden and then the kitchen.
0:32:57 > 0:33:00Unfortunately, that's where it all starts to go a little bit wrong.
0:33:00 > 0:33:02That is very, very, very tired,
0:33:02 > 0:33:06but it's a good sized space and, all in all, yeah, not a bad start.
0:33:06 > 0:33:11Upstairs the feeling of space continues.
0:33:11 > 0:33:14You've got three good sized bedrooms. A box room here,
0:33:14 > 0:33:17double room there, another double room at the front
0:33:17 > 0:33:20and a bathroom and loo upstairs, too. So everything you want.
0:33:20 > 0:33:23So, actually, it's looking pretty good.
0:33:23 > 0:33:28However, there is a catch. Sadly, this is a repossession property
0:33:28 > 0:33:32and as with many repossession properties the completion time
0:33:32 > 0:33:35from buying it at the auction to actually having to pay
0:33:35 > 0:33:41the entire amount of money is just 14 days as opposed to the usual 28,
0:33:41 > 0:33:45so if you go to the auction and don't have your finances
0:33:45 > 0:33:49in place you could have a very, very nasty shock coming.
0:33:49 > 0:33:54However the tight completion deadline might be the least of the purchaser's worries.
0:33:54 > 0:33:58If you step outside the back door into this rather small garden
0:33:58 > 0:34:02you can see that the exterior is rather different from the neighbouring properties.
0:34:02 > 0:34:06- Basically this house is one that - many would choose to avoid.
0:34:06 > 0:34:09It's of nonstandard construction.
0:34:09 > 0:34:12It's a timber frame house, not unusual for modern builds,
0:34:12 > 0:34:16but this one doesn't have a brick facia protecting the exterior.
0:34:16 > 0:34:20That may make it difficult to mortgage and therefore to sell on.
0:34:20 > 0:34:24Most of the neighbouring houses have already had the remedial work done
0:34:24 > 0:34:27and a brick skin added.
0:34:27 > 0:34:30That's definitely something I'd consider here, too,
0:34:30 > 0:34:32so it's not without its share of problems,
0:34:33 > 0:34:37but with a guide price of between £35,000 and £41,000
0:34:37 > 0:34:39was it still a good buy?
0:34:39 > 0:34:42I asked a local estate agent what she thought of it.
0:34:42 > 0:34:44The pros and cons I feel in this particular property
0:34:44 > 0:34:47is it's got three fantastic sized bedrooms
0:34:47 > 0:34:49for a three bedroom in this area.
0:34:49 > 0:34:53It's got a good sized bathroom, it's got a decent sized kitchen,
0:34:53 > 0:34:56the garden is all fenced so it's nice and secure
0:34:56 > 0:34:59and it's also got off-road parking.
0:34:59 > 0:35:02Because it is timber framed you probably wouldn't be able
0:35:02 > 0:35:03to get a mortgage on it.
0:35:03 > 0:35:06However, for the rental market it's absolutely fine.
0:35:08 > 0:35:11As the new train station makes Cardiff only 12 minutes away,
0:35:11 > 0:35:14that rental option looks very appealing.
0:35:14 > 0:35:18So, with the property guided at between 35,000 and 41,000
0:35:18 > 0:35:20what sort of return could it generate?
0:35:20 > 0:35:24The rental market in this area is very good,
0:35:24 > 0:35:27so you'd probably get between £400 and £450 per calendar month.
0:35:27 > 0:35:30Of course, if you did this property up to sell it,
0:35:30 > 0:35:33as long as you did the required brickwork,
0:35:33 > 0:35:38then you would probably get between £80,000 and £87,000.
0:35:42 > 0:35:44Well, there's a bit of sorting out to do,
0:35:44 > 0:35:46but overall this is a great little family house.
0:35:46 > 0:35:49Yes, I'd spend some money on the kitchen and the bathroom
0:35:49 > 0:35:51and certainly outside needs figuring out.
0:35:51 > 0:35:54Apart from that, it's a good one to go for.
0:35:54 > 0:35:56Let's see who fancied it at the auction.
0:35:59 > 0:36:02Lot number six, then, ladies and gentlemen.
0:36:02 > 0:36:05Who's going to bid me bid £40,000 to start?
0:36:05 > 0:36:07It's got to be worth more than that, surely.
0:36:07 > 0:36:1040? 38 then, let's get started.
0:36:10 > 0:36:1338. Thank you, sir. At 38 I'm bid.
0:36:13 > 0:36:15Thank you. 38. 40 can I now...
0:36:15 > 0:36:19Nine then, all right. 39, then I'm bid. Thank you. 40 on my left.
0:36:19 > 0:36:20At £40,000. This is no money.
0:36:20 > 0:36:23You're out over there. There is my...
0:36:23 > 0:36:27And one in the back. Thank you. At 41 I'm bid. Two will you, sir? At two.
0:36:27 > 0:36:30Thank you. At 42 I'm bid here. Out by the steps at 42,000.
0:36:30 > 0:36:32At 42. Shout if I'm missing you.
0:36:32 > 0:36:35At 43. 44 can I now, then?
0:36:35 > 0:36:37At 43,000, thank you sir.
0:36:37 > 0:36:43At 43. Four can I now? At 43 I'm going to sell it, make no mistake.
0:36:43 > 0:36:45At £43,000 are you all done?
0:36:45 > 0:36:50The hammer's up, then. It's going to be sold at £43,000.
0:36:50 > 0:36:54Yours, sir. Thank you.
0:36:54 > 0:37:00The man who won the property was Cardiff based former painter and decorator, Mike.
0:37:00 > 0:37:04He's roped in his son Mark to help him with this project.
0:37:04 > 0:37:07I met them both back at Parkview to find out more.
0:37:10 > 0:37:13So, congratulations. Why did you want to buy this place?
0:37:13 > 0:37:17I think it was the price and the area that really got me interested in it.
0:37:17 > 0:37:20Have you got experience of property developing,
0:37:20 > 0:37:23- is it something you do? - This is my fifth one.- Right.
0:37:23 > 0:37:26What had happened to me, I got to retirement age
0:37:26 > 0:37:30from painting and decorating and I suddenly realised my
0:37:30 > 0:37:34pension was somewhat inadequate, so I decided to go on a course
0:37:34 > 0:37:38of buy-to-let properties. It's my intention to have between
0:37:38 > 0:37:42- 10 and 12 and that will be perfectly adequate for my pension.- Right.
0:37:42 > 0:37:46This is number five. There's two more lined up at the present time.
0:37:46 > 0:37:50I also look after one or two properties for friends
0:37:50 > 0:37:53and clients of mine as well, so it's going quite well.
0:37:53 > 0:37:59Mike started this type of pension plan two and a half ago.
0:37:59 > 0:38:02He's hoping to have his portfolio fully built up
0:38:02 > 0:38:05in another three years. Now he's retired he devotes
0:38:05 > 0:38:09a lot of time to studying the property market, but he's going to
0:38:09 > 0:38:13leave devoting time to getting this place renovated to his son, Mark.
0:38:13 > 0:38:17We worked together on a previous property. That went quite well.
0:38:17 > 0:38:20Personally, I run my own property maintenance business.
0:38:20 > 0:38:23- Ah!- Specialising in kitchens, bathrooms and my father's asked
0:38:23 > 0:38:25me to come and do the work here.
0:38:25 > 0:38:26That fits in quite well, then.
0:38:26 > 0:38:28Well, for him it does, yeah!
0:38:28 > 0:38:31But are you entering this as a joint venture?
0:38:31 > 0:38:35- No, this one's purely for my father. - So, he's going to pay you, then?
0:38:35 > 0:38:38We'll be hoping so, yeah.
0:38:38 > 0:38:42Well, what's the use of having a family if you can't exploit them?
0:38:42 > 0:38:45But, joking aside, Mike is happy to take a hands-off role
0:38:45 > 0:38:49and leave Mark to oversee a basic renovation. At present,
0:38:49 > 0:38:52Mike can't see any problems on the horizon for this house,
0:38:52 > 0:38:55which is not how things were at the auction.
0:38:57 > 0:39:00I thought I knew my way around the auction room.
0:39:00 > 0:39:03I suddenly discovered it was a repossession,
0:39:03 > 0:39:09which means that you complete within 14 days, not the normal 28 days.
0:39:09 > 0:39:12Not in every repossession, but on some, for sure.
0:39:12 > 0:39:15And then, because it was the day after a bank holiday,
0:39:15 > 0:39:19the completion date was brought forward to the Friday prior,
0:39:19 > 0:39:23so I really had an 11 day completion to try and complete.
0:39:23 > 0:39:28I couldn't get the mortgage through in time, so I sort of pooled all my
0:39:28 > 0:39:31- deposits for future houses together and paid cash.- Really?
0:39:31 > 0:39:33I was still a few days late, though.
0:39:33 > 0:39:36It must have been a bit of a worrying time.
0:39:36 > 0:39:39It was certainly a very interesting time and I had
0:39:39 > 0:39:41a few hours less sleep than I normally do.
0:39:41 > 0:39:45At what point did you discover the 14 day completion period?
0:39:45 > 0:39:49- When I was paying the deposit at the auction!- Right.
0:39:50 > 0:39:53Mike had read the legal pack, but the details of buying
0:39:53 > 0:39:57a repossession were in the small print, which he missed.
0:39:57 > 0:40:00It just shows how important it is to check all of that
0:40:00 > 0:40:04when buying at auction. Fortunately, Mike was able to pool his funds
0:40:04 > 0:40:09to come up with that £43,000 purchase price,
0:40:09 > 0:40:12otherwise he'd have faced losing his deposit,
0:40:12 > 0:40:16so now the plan is to get this house earning and quick.
0:40:16 > 0:40:19Give me an idea of how long this will take to get sorted?
0:40:19 > 0:40:22- We've had a look around and we think 10 days...- Wow!
0:40:22 > 0:40:24It'll all be done, no problem.
0:40:24 > 0:40:27- How many people have you working on it?- Two of us.
0:40:27 > 0:40:31- Two in 10 days!- Yeah.- Including the kitchen and a bathroom?- Definitely.
0:40:31 > 0:40:34You're not going to put new kitchens and bathrooms in?
0:40:34 > 0:40:38No, the bath will be moved, shower screen put in, generally cleaned up.
0:40:38 > 0:40:41It's all been tiled recently. The kitchen, same thing.
0:40:41 > 0:40:45A couple of units replaced. A lick of paint, replace the hob,
0:40:45 > 0:40:48the cooker, the extractor, it'll be nice.
0:40:48 > 0:40:50Right, and the cost you've worked out?
0:40:50 > 0:40:52Including fees for the cost,
0:40:52 > 0:40:55the whole cost to my father will be about £7,000.
0:40:55 > 0:40:57Right. And how do you feel about that?
0:40:57 > 0:41:01Very adequate. Very happy about it. I don't want to cut any corners,
0:41:01 > 0:41:05but I don't want to waste any money and with my experience with Mark
0:41:05 > 0:41:08on previous properties I'm very happy to hand my credit card
0:41:08 > 0:41:11and the keys over to him and go on holiday for a couple of weeks.
0:41:11 > 0:41:15- That's a great way to do it if you can, isn't it?- Yes, it certainly is.
0:41:15 > 0:41:17If all goes according to plan,
0:41:17 > 0:41:22Mike's renovation budget of £7,000, plus the purchase price of 43,000,
0:41:22 > 0:41:27will mean a total spend of 50,000 quid and, as the house
0:41:27 > 0:41:32is purely for rental purposes, he's not concerned that it's of nonstandard construction.
0:41:37 > 0:41:40Mike and Mark make a good team to take on this project
0:41:40 > 0:41:43and help Mike create his portfolio of properties
0:41:43 > 0:41:46to help him in his retirement. However, I am a bit concerned
0:41:46 > 0:41:49about their timescales. Can they really sort this out in 10 days?
0:41:49 > 0:41:52And I don't think they're doing the right thing
0:41:52 > 0:41:54by not completely replacing the kitchen.
0:41:54 > 0:41:57You can find out how they get on later in the show.
0:42:00 > 0:42:05The months have rolled by and it's time now to see how our developers have been getting on.
0:42:05 > 0:42:08Yes, did they unearth treasures or just uncover a load of rubbish?
0:42:08 > 0:42:10Let's find out.
0:42:10 > 0:42:14Earlier, in Chatham, we met Paul and Paul
0:42:14 > 0:42:19who bought this derelict house for 282,000.
0:42:19 > 0:42:21That's a lot for a burnt out shell,
0:42:21 > 0:42:24but it looked like it had definitely reached the end of the line.
0:42:24 > 0:42:27# I'm going down, down, down, down
0:42:27 > 0:42:31# I'm going down, down, down, down. #
0:42:31 > 0:42:35With it came planning permission for a new development of five houses.
0:42:35 > 0:42:38For the two Pauls moving from renovating properties
0:42:38 > 0:42:41to developing a large site was a big jump and they also had
0:42:41 > 0:42:46the risk of developing a new build in the current property market.
0:42:46 > 0:42:47One year later,
0:42:47 > 0:42:52we returned to see if what was on the plans is now on the land.
0:43:09 > 0:43:13There it is, big, loud and proud and all
0:43:13 > 0:43:15five townhouses still in progress.
0:43:15 > 0:43:19On the front of the property is where you see the steel columns.
0:43:19 > 0:43:21We're going to have a small balcony on each property
0:43:21 > 0:43:25just to give enough room for a table and chairs for people to sit out on.
0:43:25 > 0:43:29Each property has got a garage, so again there's nice off-road parking.
0:43:29 > 0:43:32We're going to have block paving going down towards the gates.
0:43:32 > 0:43:35Over on this side we're going to have a recreation area
0:43:35 > 0:43:37to let kids play and maybe a set of swings or a slide,
0:43:37 > 0:43:41and then on the entrance. we're going to have electric gates,
0:43:41 > 0:43:45probably just with a zapper to block it into its own community.
0:43:46 > 0:43:50The build seems to be following the original five house plan,
0:43:50 > 0:43:52but with the quarter acre site
0:43:52 > 0:43:55they had considered expanding the development.
0:43:55 > 0:43:58Originally we wanted to get six houses on here
0:43:58 > 0:44:01and there is enough room with the total size of the plot,
0:44:01 > 0:44:05but the council were a little bit reluctant to change the plans,
0:44:05 > 0:44:08so we just run with the plans as they were.
0:44:08 > 0:44:11But they did get some joy when planning permission was granted
0:44:11 > 0:44:16to allow the three bedroom houses an extra fourth bedroom.
0:44:16 > 0:44:19OK, this is the four bedroom house. The difference between this one and
0:44:19 > 0:44:22the middle house is that it's a three bedroom in the middle
0:44:22 > 0:44:25and all the difference is a petition wall down the middle.
0:44:25 > 0:44:28Otherwise exactly the same layout. Master bedroom, there,
0:44:28 > 0:44:32and on the right hand side there's an en suite.
0:44:32 > 0:44:36The detail that we quite like with the bedrooms in the upper floor
0:44:36 > 0:44:40is that the roof doesn't cut through too deeply into the actual room.
0:44:40 > 0:44:41They're quite high, over six feet,
0:44:41 > 0:44:45so anyone can walk underneath them and still not bump their head.
0:44:46 > 0:44:49OK, this brings us to the middle floor, the second floor.
0:44:49 > 0:44:54We've got a double bedroom on the right hand side, bathroom, main bathroom, toilet and sink.
0:44:54 > 0:44:57On the left hand side we've got the living room. Large hallway
0:44:57 > 0:45:01and a good bit of storage at the back with double doors on.
0:45:01 > 0:45:04The design of the properties we're quite pleased with.
0:45:04 > 0:45:07They're 1,500 square foot and usually a four bedroom's
0:45:07 > 0:45:10round about 1,100, 1,200 mark, so we feel that they're pretty good value.
0:45:10 > 0:45:16And, finally, on the ground floor, the kitchen looks on to a small garden.
0:45:16 > 0:45:19So far this development is coming together well,
0:45:19 > 0:45:23but I can't help feeling that a big downside is its location.
0:45:23 > 0:45:27The fact that it backs on to a busy road might put some buyers off.
0:45:27 > 0:45:32But inside, with the electrics and plumbing currently being installed,
0:45:32 > 0:45:34the finish line is now only six weeks away.
0:45:36 > 0:45:39Developments this size can throw up problems,
0:45:39 > 0:45:42but it seems this has been a pain free experience for the two Pauls.
0:45:42 > 0:45:45To be honest, we haven't really even project managed.
0:45:45 > 0:45:47The developers have done that.
0:45:47 > 0:45:51We've literally looked at the prices, signed a contract
0:45:51 > 0:45:53and left them with it, so it's been fairly easy.
0:45:53 > 0:45:56At the end of the day, it's a turnkey operation.
0:45:56 > 0:46:00We pay the money and that's it. So it's all down to them.
0:46:00 > 0:46:03As long as we get the five sets of keys back we'll be all right!
0:46:03 > 0:46:05This is the first time I've been here
0:46:05 > 0:46:07for about two months.
0:46:07 > 0:46:13The option of project managing a development like this in order to save money can appear attractive.
0:46:15 > 0:46:17I reckon that two Pauls have done the right thing
0:46:17 > 0:46:21in leaving this larger build to experienced developers.
0:46:21 > 0:46:25Hold ups would have cost money which might have affected their budget.
0:46:25 > 0:46:27Speaking of which...
0:46:27 > 0:46:31We'd planned to spend sort of up to 350 grand for the land
0:46:31 > 0:46:36and we actually got that for 282, and then the build costs we were expecting about 500,
0:46:36 > 0:46:38but we've actually run up to about 575,
0:46:38 > 0:46:42so it's not bundles over when you're looking at five dwellings.
0:46:42 > 0:46:47That means their projected total spend will be 857,000.
0:46:47 > 0:46:52It's a big investment for their first major development.
0:46:52 > 0:46:56In the current troubled property market, new builds like this can prove a risky venture.
0:46:57 > 0:47:01If you've got a decent... You know, a property that you want to sell...
0:47:01 > 0:47:04they're all going to be brand new, all fitted out,
0:47:04 > 0:47:06kitchens, fully carpeted,
0:47:06 > 0:47:09so we're spending a few quid as regards to making them look right,
0:47:09 > 0:47:12so we feel that that will actually help us sell them.
0:47:16 > 0:47:20With the boys' bank accounts lighter to the tune of 857,000,
0:47:20 > 0:47:23it's time to find out if two local estate agents
0:47:23 > 0:47:28think this new development has what it takes to catch the market's eye.
0:47:28 > 0:47:31The first impressions are that the houses
0:47:31 > 0:47:33are being extremely well built
0:47:33 > 0:47:37and I think the finish when it is done is going to be quite something.
0:47:37 > 0:47:43My first impressions are that it's got a great entrance as you drive or walk in.
0:47:43 > 0:47:48They're nice to look at, they've got lots of light from obviously the windows and French doors
0:47:48 > 0:47:51and the balconies, so they've got a good attractive appeal to them.
0:47:51 > 0:47:55When you first look at the houses they do look fairly narrow,
0:47:55 > 0:47:57but when you go into them you can see
0:47:57 > 0:47:59that they've got a good amount of space.
0:47:59 > 0:48:02All the rooms are great sizes.
0:48:02 > 0:48:05There's no denying there will be a lot of space here,
0:48:05 > 0:48:09but could the location prove a bit of a drawback?
0:48:09 > 0:48:11I think the main negatives, as you can probably hear,
0:48:11 > 0:48:14is the heavy traffic and probably in the morning
0:48:14 > 0:48:17is when commuters who live here are going to have the main problem,
0:48:17 > 0:48:22getting out into the traffic, getting down into Chatham or Gillingham where the stations are
0:48:22 > 0:48:25you have to drive, it is not walkable.
0:48:26 > 0:48:31There's not much you can do about that, so what could the houses sell for?
0:48:31 > 0:48:37Price-wise, I think we're really going to be looking somewhere round about the 180,000 to the 210 mark.
0:48:37 > 0:48:44Once the properties are completed, I would expect to achieve anywhere between £190,000 and £210,000.
0:48:44 > 0:48:49I think they're OK. I mean, it's not far from where we thought they were going to be.
0:48:49 > 0:48:53We've got one estate agent that's doing them at 229, so 19k difference,
0:48:53 > 0:48:56it's not bundles of money so, no, I'm quite happy.
0:49:01 > 0:49:06So, with the five houses, given their 857,000 spent,
0:49:06 > 0:49:12that could leave them with a possible pre tax profit of £193,000.
0:49:12 > 0:49:15What could they achieve in rentals?
0:49:15 > 0:49:21I would suggest placing them on the rental market at between 850 and 950 per calendar month.
0:49:21 > 0:49:27I think we'd be looking somewhere between the £850 to £900 per calendar month.
0:49:27 > 0:49:30- That's about...- About right.
0:49:30 > 0:49:35I was thinking around 900, 950, so not much difference to what we was thinking.
0:49:36 > 0:49:40Six weeks later photos show that the development is now finally completed.
0:49:40 > 0:49:44Both Pauls are so happy with how it went that when their next build goes
0:49:44 > 0:49:48ahead they'll leave it to the professionals again.
0:49:49 > 0:49:51It's about turnover more than anything.
0:49:51 > 0:49:55If you tie yourself down to one project, then that's it.
0:49:55 > 0:49:58This way, if you've got a contractor that's going to do it for you,
0:49:58 > 0:50:01you can do half a dozen jobs in one year if you wanted to.
0:50:01 > 0:50:04That's sort of financially better off really doing it that way.
0:50:12 > 0:50:17When retired painter-decorator Mike decided that his pension needed a boost,
0:50:17 > 0:50:21he felt that a property portfolio was the way forward.
0:50:21 > 0:50:25With four houses already earning, number five was to be this
0:50:25 > 0:50:28three-bedroom house in Llanharan near Cardiff.
0:50:28 > 0:50:36Mike had paid £43,000 at auction and it only needed superficial work to get it into rentable shape,
0:50:36 > 0:50:41but when Mike says he's retired he means retired, so that's where son Mark comes in.
0:50:41 > 0:50:44With my experience on previous properties I'm happy
0:50:44 > 0:50:48to hand my credit card and the keys over to him and go on holiday for a couple of weeks.
0:50:48 > 0:50:52Mark reckoned he could do a basic refurbishment in 10 days
0:50:52 > 0:50:56and on a budget of 7,000, so two months later we returned
0:50:56 > 0:51:03to see whether Mike's credit card has taken a hammering or his pension pot has had a welcome boost.
0:51:05 > 0:51:12The outside has had a fresh coat of paint and certainly looks more appealing, and inside?
0:51:12 > 0:51:18Well, it's amazing what some redecoration and new carpeting can achieve.
0:51:18 > 0:51:24It's a very functional style, which is just what Mike wants for that rental market.
0:51:26 > 0:51:28This room's changed quite considerably.
0:51:28 > 0:51:32The first task was to remove about two skip-loads of rubbish.
0:51:32 > 0:51:35Painted the ceiling, the walls and your skirting boards
0:51:35 > 0:51:38and your architraves and refurbished the doors.
0:51:38 > 0:51:43In the kitchen we've decided to keep as much as possible. Replaced some of the cupboards,
0:51:43 > 0:51:52cleaned it, cleaned the tiles, complete redecoration and we've put a new cooker, hob and extractor fan in.
0:51:52 > 0:51:57And it just goes to show that if it ain't broke, don't fix it.
0:51:57 > 0:52:01All this kitchen needed was a little attention and it's as good as new,
0:52:01 > 0:52:06all for minimal cost, and that principle has been carried on through the rest of the house.
0:52:08 > 0:52:12And here, upstairs, it was a bit garish the old paper.
0:52:12 > 0:52:18What we have done is all the walls are of magnolia, all the paintwork is white.
0:52:18 > 0:52:23We've re-carpeted the whole of this, installed mains smoke and heat alarms.
0:52:23 > 0:52:30And in the bathroom here, we've had to move the bath back about six to 10 inches.
0:52:30 > 0:52:36It was fitted away from the wall and had caused a lot of problems with dripping water.
0:52:36 > 0:52:39This has completely solved this problem.
0:52:39 > 0:52:45We've installed a new shower, made good the tiles and repainted the cupboards here.
0:52:45 > 0:52:51The bedrooms have also had a basic makeover with the same carpeting and neutral colour scheme.
0:52:54 > 0:53:00New cupboard doors have been added in the bedrooms and windows installed, so, all in all,
0:53:00 > 0:53:06it seems an efficient conversion which went even easier than Mike could have wished for.
0:53:06 > 0:53:08It was in better condition than I thought.
0:53:08 > 0:53:13It was very superficial, the random mess in the property,
0:53:13 > 0:53:17but once we'd got a few skip loads out began to take shape
0:53:17 > 0:53:20and I was very pleased at what we found.
0:53:20 > 0:53:23The man behind the renovation was son Mark.
0:53:23 > 0:53:26He oversaw every aspect from the tiling to redecoration,
0:53:26 > 0:53:29something his dad, Mike, used to do professionally.
0:53:29 > 0:53:34I've had a look at the painting finish and I probably retired at the right time.
0:53:34 > 0:53:36It's better than I could have done!
0:53:36 > 0:53:38Nothing like a father's pride!
0:53:38 > 0:53:43As Mike has bought another two properties for his portfolio already,
0:53:43 > 0:53:49I reckon he'll be calling on Mark to do the refurbishments on those soon, at the going rate, of course!
0:53:49 > 0:53:53But was the renovation on this house done in that predicted timescale?
0:53:53 > 0:53:57Well, my son said 10 days.
0:53:57 > 0:54:03In fact, he took - according to our records 12-and-a-half days - so it's not too bad!
0:54:03 > 0:54:06But we didn't realise how little work was required.
0:54:06 > 0:54:08We just did what had to be done.
0:54:08 > 0:54:14Keeping the refurbishment simple meant they managed to keep just under their budget of 7,000.
0:54:16 > 0:54:21At present Mike thinks that upgrading the property will cost around £25,000,
0:54:21 > 0:54:25so it's not an option he's considering at the moment.
0:54:28 > 0:54:31With that renovation spend just shy of £7,000
0:54:31 > 0:54:33and the purchase price of 43,000,
0:54:33 > 0:54:37their total costs so far are just under 50 grand.
0:54:37 > 0:54:43Time to find out now if it has what it takes to give Mike's pension plan a boost.
0:54:46 > 0:54:48They've done a very nice job renovating the property
0:54:48 > 0:54:52and upgrading it since the first time I came to see it.
0:54:52 > 0:54:56The standard of finish for the renovation work is quite good.
0:54:56 > 0:54:58It's not, you know, a palace,
0:54:58 > 0:55:03but the renovation standard is very good for the rental market.
0:55:03 > 0:55:10My first impressions on the property is that it's been well decorated and tidied nicely.
0:55:10 > 0:55:15It's presented in good condition and should suit well for a family or first time buyer.
0:55:17 > 0:55:21Remember, Mike's total outlay so far is nearly 50,000,
0:55:21 > 0:55:30so if he decides to sell, upgrading the house would cost £25,000, making a total possible spend of 75,000.
0:55:30 > 0:55:34So, what could an upgraded property achieve as a resale?
0:55:35 > 0:55:39I think the property would probably sell for around about £87,000.
0:55:39 > 0:55:41If the property was to be re-bricked,
0:55:41 > 0:55:45I would be expecting to achieve around about the £80,000 mark.
0:55:45 > 0:55:52That could give Mike a possible pre tax profit of 12,000, so will he go ahead with the upgrade?
0:55:52 > 0:55:57If it's going to make that much difference, in years to come I think I'd consider re-bricking it.
0:55:57 > 0:56:03As Mike is keeping the property for his pension pot, what could he expect in rentals?
0:56:03 > 0:56:09I think the rental valuation of the property now would be £475 per calendar month.
0:56:09 > 0:56:15For rental purposes, I would value this property between £425 and £450 per calendar month.
0:56:15 > 0:56:21Well, the 475 would give a return of 11.4%,
0:56:21 > 0:56:26but I've already let the property at 500 a month which will give me a 12% return.
0:56:26 > 0:56:33So, it looks like property number five out of 13 is already paying its way, so with six and seven waiting
0:56:33 > 0:56:39for the paint brush treatment has Mike got any plans about where he'll get the rest of his pension plan?
0:56:39 > 0:56:41I certainly will go back to auction.
0:56:41 > 0:56:44I don't think you could keep me away from them!
0:56:47 > 0:56:49Lots of things to think about there.
0:56:49 > 0:56:52Did those stories whet your appetite and leave you wanting more?
0:56:52 > 0:56:56We'll have lots more tales from the auction rooms next time.
0:56:56 > 0:56:58- We'll see you then. - Goodbye.- Goodbye.