0:00:02 > 0:00:03If you're an auction-goer,
0:00:03 > 0:00:07you'll be familiar with the gavel going down when the lot is sold.
0:00:07 > 0:00:09If that is what gets your blood pumping,
0:00:09 > 0:00:11you're in for a treat today.
0:00:11 > 0:00:15We've got three properties, all of which went under the hammer.
0:00:40 > 0:00:43The property market is up and down at the best of times,
0:00:43 > 0:00:45but now it's certainly tough.
0:00:45 > 0:00:48But there are still bargains to be had at the auction.
0:00:48 > 0:00:52So do your homework, do your research, set yourself a limit,
0:00:52 > 0:00:54and you could still be in with a chance.
0:00:54 > 0:00:57So let's see who's bidding on today's show.
0:00:58 > 0:01:01'This Southampton property
0:01:01 > 0:01:03'with four floors, two flats and three problems.'
0:01:03 > 0:01:07But it's all just a bit bland, bland, bland.
0:01:08 > 0:01:13'You could be in for a shock at this Hartlepool house.'
0:01:13 > 0:01:17A good size. Looks like the electrics are slightly dodgy.
0:01:19 > 0:01:21'And in London, a top-floor flat
0:01:21 > 0:01:25'that comes with all the fun of the fair.'
0:01:25 > 0:01:28It's like walking around in a fun house at a theme park.
0:01:30 > 0:01:32'These all went to auction.
0:01:32 > 0:01:35'We'll find out who bought them and what they paid
0:01:35 > 0:01:37'when they went under the hammer.'
0:01:37 > 0:01:38It's yours, sir.
0:01:41 > 0:01:43'I'm in Southampton, Hampshire,
0:01:43 > 0:01:47'where there are two universities and a busy port.'
0:01:48 > 0:01:53This is Oxford Street - not the famous shopping Mecca in London
0:01:53 > 0:01:56but one of Southampton's more desirable areas.
0:01:56 > 0:02:00There's plenty of smart restaurants and shops everywhere.
0:02:00 > 0:02:02But back in the 14th century,
0:02:02 > 0:02:05this area belonged to the Queen's College, Oxford -
0:02:05 > 0:02:06hence the street name -
0:02:06 > 0:02:10and the property I'm here to see today is just on this road.
0:02:11 > 0:02:16'But it's not just commercial property that can be found here.'
0:02:17 > 0:02:21This is what I'm here to see, this rather grand-looking property.
0:02:21 > 0:02:23It's a Georgian mid-terrace
0:02:23 > 0:02:27and it went to auction for a guide of £245,000.
0:02:27 > 0:02:33And I love it! Let's hope there's loads of character inside.
0:02:33 > 0:02:36'There's certainly plenty of it outside.
0:02:36 > 0:02:39'This four-storey property is Grade II listed,
0:02:39 > 0:02:41'so it's protected by law.
0:02:41 > 0:02:46'You'd be restricted in what you can do to change inside and out.'
0:02:47 > 0:02:51This whole building has been subdivided into two flats.
0:02:51 > 0:02:54So you walk in the front door and up this flight of stairs,
0:02:54 > 0:02:57with this gorgeous original staircase,
0:02:57 > 0:02:58to the top flat.
0:02:58 > 0:03:01Through here is the sitting room.
0:03:01 > 0:03:06In a Georgian house you'd expect to see panelled doors, deep cornicing,
0:03:06 > 0:03:11big feature fireplaces, a ceiling rose, shutters on the windows,
0:03:11 > 0:03:14nine-inch timber floorboards,
0:03:14 > 0:03:17not dusty, pink, bobbly carpet,
0:03:17 > 0:03:20woodchip wallpaper, storage heaters!
0:03:20 > 0:03:21I do love the location,
0:03:21 > 0:03:25the windows are beautiful, it's got an amazing facade.
0:03:25 > 0:03:30But what a disappointment inside! There's just no character at all.
0:03:31 > 0:03:33'Such a shame.
0:03:33 > 0:03:35'But if you went to town on this place,
0:03:35 > 0:03:39'put some features back in the two large bedrooms at the top...
0:03:42 > 0:03:45'and transformed the pokey bathroom...
0:03:46 > 0:03:49'and that drab kitchen,
0:03:49 > 0:03:52'you could turn it into something really special.
0:03:52 > 0:03:53'Even better than that,
0:03:53 > 0:03:58'you could reinstate both flats as one magnificent house.
0:03:58 > 0:04:00'Time to check out flat two now.
0:04:00 > 0:04:05'Sadly, the entrance isn't as imposing. It's at the rear.
0:04:05 > 0:04:08'However, you do get off-street parking.
0:04:08 > 0:04:12'I wonder what the inside has to offer.'
0:04:13 > 0:04:16A much bigger kitchen in this flat.
0:04:16 > 0:04:18You could have a table over there.
0:04:18 > 0:04:20You can see it's all been neutrally decorated.
0:04:20 > 0:04:25It's a bit strange that you have to walk past this blocked-in staircase
0:04:25 > 0:04:27to get to the lounge.
0:04:27 > 0:04:33It is a good size. Again, there's a beautiful feature window.
0:04:33 > 0:04:37But it's all just a bit bland, bland, bland.
0:04:40 > 0:04:43'Down in the basement there's a double bedroom...
0:04:44 > 0:04:47'one single bedroom...
0:04:47 > 0:04:49'and a small bathroom.
0:04:49 > 0:04:53'Those small windows make them all a bit dingy.
0:04:53 > 0:04:55'They need a full refurbishment.
0:04:55 > 0:04:59'But there is one big issue with this property.'
0:04:59 > 0:05:02The whole property, i.e. both flats
0:05:02 > 0:05:05are under one title on the Land Registry,
0:05:05 > 0:05:09so, as far as they're concerned, this is still one house.
0:05:09 > 0:05:12Because of this, it'll be hard to get a mortgage.
0:05:12 > 0:05:14If you wanted to keep it as flats,
0:05:14 > 0:05:17you could apply for retrospective planning consent
0:05:17 > 0:05:22if you can prove it was divided into two separate dwellings some time ago.
0:05:22 > 0:05:25And then, separate titles can be created
0:05:25 > 0:05:28and the property changed from freehold to leasehold.
0:05:28 > 0:05:32But you would need legal advice, and that will cost you.
0:05:33 > 0:05:36'Finding proof of division shouldn't be a problem.
0:05:36 > 0:05:39'You could probably get that from the council tax records.
0:05:39 > 0:05:44'But drawing up separate plans and creating leaseholds will be more expensive.
0:05:44 > 0:05:46'If the demand's there,
0:05:46 > 0:05:49'I'd love to see this place restored to one single home.
0:05:49 > 0:05:52'What does the local estate agent
0:05:52 > 0:05:54'think would be the best option?'
0:05:54 > 0:05:57'You could put it into one house quite easily.
0:05:57 > 0:05:59'But from a business perspective,
0:05:59 > 0:06:02you'd be better off leaving it as two apartments,
0:06:02 > 0:06:05accentuating the two apartments as they are at the moment.
0:06:06 > 0:06:09'If you left this place as two two-bed flats,
0:06:09 > 0:06:12'you could expect to get a combined rental income
0:06:12 > 0:06:15'of about £1,500 per calendar month.
0:06:15 > 0:06:18'But if done up to a reasonable standard,
0:06:18 > 0:06:20'how much would they sell for?'
0:06:20 > 0:06:24The resale value of the flats would probably be around £175,000 each.
0:06:24 > 0:06:27I'd keep it probably as it is at the moment,
0:06:27 > 0:06:31just accentuate it, separate the title and let the two properties out.
0:06:35 > 0:06:38This is a lovely period property. It's in a prime location.
0:06:38 > 0:06:42It's unfortunate that the flats inside lack character.
0:06:42 > 0:06:45But you can always put back those period features,
0:06:45 > 0:06:48although it can be a pricey exercise.
0:06:48 > 0:06:50There's also the title issue to sort out.
0:06:50 > 0:06:53But I think I've fallen a little in love with this one.
0:06:53 > 0:06:56Will the new owner feel the same?
0:06:56 > 0:06:58Let's find out who bought it at auction.
0:07:01 > 0:07:06Lot No.10, Oxford Street in Southampton, Hampshire.
0:07:06 > 0:07:09£215,000 is what I'm looking for.
0:07:09 > 0:07:12Somebody start the bidding at 215.
0:07:12 > 0:07:15Gentleman in the back left-hand corner. Thank you.
0:07:15 > 0:07:17217. Thank you, sir, directly in front of me.
0:07:17 > 0:07:19219 I have got.
0:07:19 > 0:07:21221.
0:07:21 > 0:07:23223 I have.
0:07:23 > 0:07:24225.
0:07:24 > 0:07:25227.
0:07:25 > 0:07:27229.
0:07:27 > 0:07:30231? 231 I've got.
0:07:30 > 0:07:31233.
0:07:31 > 0:07:32235.
0:07:32 > 0:07:35237.
0:07:35 > 0:07:36At the back at 238.
0:07:36 > 0:07:38238 is now bid against you.
0:07:38 > 0:07:40239.
0:07:40 > 0:07:41240?
0:07:41 > 0:07:43241, left-hand corner.
0:07:43 > 0:07:45242 here in the front.
0:07:45 > 0:07:47243.
0:07:47 > 0:07:48244?
0:07:48 > 0:07:50245 he's nodding to.
0:07:50 > 0:07:52246.
0:07:52 > 0:07:53247. He's made that bid.
0:07:53 > 0:07:55248 here.
0:07:55 > 0:07:58£249,000, sir, is what I now need.
0:07:58 > 0:08:00249. He's nodding.
0:08:00 > 0:08:01250?
0:08:01 > 0:08:04250's here. 250,000, seated.
0:08:04 > 0:08:07Looking for 251. Shake of the head.
0:08:07 > 0:08:09Anywhere else in the room? Last chance, sir.
0:08:09 > 0:08:12250,000 here in the front.
0:08:12 > 0:08:16£250,000 I have for the first.
0:08:16 > 0:08:20250,000 for the second.
0:08:20 > 0:08:23250,000 for the third and the final time.
0:08:23 > 0:08:27Your property, sir. Well done. Your number, please.
0:08:27 > 0:08:31'Robin made that successful bid of £250,000.
0:08:31 > 0:08:35'It was just on the right side of that 3% stamp duty threshold.
0:08:35 > 0:08:40'One penny more and he'd have had to pay an extra five grand.
0:08:40 > 0:08:43'He was at the auction with his wife Sue.
0:08:43 > 0:08:47'In the last 20 years they've been buying and developing property.
0:08:47 > 0:08:52'Now their son Chris, a trained cabinet maker, has joined the business.'
0:08:54 > 0:08:58Guys, congratulations. You must be so pleased you got this at auction.
0:08:58 > 0:09:00Extremely pleased.
0:09:00 > 0:09:04We're very enthusiastic about character properties like this
0:09:04 > 0:09:07and keen to try and restore it to its former glory.
0:09:07 > 0:09:10As you can see, most of that has been taken away.
0:09:10 > 0:09:13So did you all view this property prior to auction?
0:09:13 > 0:09:15Chris, how involved did you get?
0:09:15 > 0:09:18We all came initially before the auction
0:09:18 > 0:09:22and me and my mum tried to encourage my dad to try and buy it,
0:09:22 > 0:09:28cos of the area, and we did notice the potential the property had.
0:09:28 > 0:09:31You see, your dad's all keen now he's here.
0:09:31 > 0:09:33Why didn't you want to buy this?
0:09:33 > 0:09:35Why did your son have to encourage you?
0:09:35 > 0:09:40Probably couldn't see the potential through the magnolia and woodchip wallpaper.
0:09:40 > 0:09:44And I think I underestimated how popular the area is.
0:09:44 > 0:09:49When I started to see it's very sought-after to even be near Oxford Street,
0:09:49 > 0:09:53it suddenly clicked up here it's a great one to get.
0:09:54 > 0:09:56'With 20 years' property experience,
0:09:56 > 0:10:00'Robin's taken full advantage of the depressed market at the moment.
0:10:00 > 0:10:04'He's bought almost a flat a month for the last seven to eight months
0:10:04 > 0:10:07'and has now acquired this imposing Georgian house.
0:10:08 > 0:10:12'So, what are they going to do with it?
0:10:12 > 0:10:15It can either be two fabulous flats or a fabulous house.
0:10:15 > 0:10:19It would be nice to get it really traditionally back as a house.
0:10:19 > 0:10:24They're very scarce, obviously, Georgian town houses now.
0:10:24 > 0:10:26It depends on the finances.
0:10:26 > 0:10:30I think initially we'll have it as two flats
0:10:30 > 0:10:35and try and get some rental income to cover the loan interest.
0:10:35 > 0:10:40We'll do a makeover on the upstairs flat so we can let that as soon as possible.
0:10:40 > 0:10:42Not necessarily do the full restoration.
0:10:42 > 0:10:48But the downstairs flat, we'll focus on a new kitchen in here, all the floorings,
0:10:48 > 0:10:53probably put gas central heating in and the fireplaces back in and suchlike.
0:10:55 > 0:10:59'The family may still decide to reinstate this as one house.
0:10:59 > 0:11:03'For that reason, they're not planning to change the title deeds just yet.
0:11:03 > 0:11:08'Instead, they want to spend around £5,000 on a quick makeover upstairs
0:11:08 > 0:11:11'and get that rented out within about a month.
0:11:11 > 0:11:16'They'll spend a further £15,000 and three months on the downstairs
0:11:16 > 0:11:19'to get some character features back into the place.
0:11:19 > 0:11:22'It's Mum's job to sort out the design.'
0:11:22 > 0:11:26I just want to put it back as it was.
0:11:26 > 0:11:29It seems such a shame that a lovely, period, listed building
0:11:29 > 0:11:33has been left to end up like this in such an awful state.
0:11:33 > 0:11:36So your gut instinct, when you first walked in,
0:11:36 > 0:11:39did you think, "Oh! I would love to turn this into a family house",
0:11:39 > 0:11:42or, "This would be a great rental return - two flats"?
0:11:42 > 0:11:45No, my first instinct was: I'd love to live here.
0:11:45 > 0:11:48- Really?- That was my first thought - I just loved the building -
0:11:48 > 0:11:50to put it back to a family home.
0:11:50 > 0:11:55But then I get brought back to earth by Rob, and he says,
0:11:55 > 0:11:59"No. We've got to finance this, so we have to bring it down.
0:11:59 > 0:12:01"We'll have to rent one flat, we can do one up.
0:12:01 > 0:12:04"We've got to finance this. It's not straightforward."
0:12:04 > 0:12:06Have you done any research on the building?
0:12:06 > 0:12:08I've been to the City Archives,
0:12:08 > 0:12:11looked through old Kelly's Directories and things like that.
0:12:11 > 0:12:15It's been lots of different things over the years.
0:12:15 > 0:12:19It started life as a single home with servants living in the basement.
0:12:19 > 0:12:22Originally it was set out by somebody called Laishley,
0:12:22 > 0:12:24who was a developer in the area.
0:12:24 > 0:12:27This was sold, as lots, at auction.
0:12:27 > 0:12:29Which is incredible. It's done the full circle.
0:12:29 > 0:12:32Here you are, buying it, as a house at auction.
0:12:32 > 0:12:36It was fascinating to find that and see the plot marked on here.
0:12:36 > 0:12:38And it had a huge garden.
0:12:38 > 0:12:41Sue, good luck with this. I can see how passionate you are.
0:12:41 > 0:12:42Thank you.
0:12:43 > 0:12:45'There's no garden any more,
0:12:45 > 0:12:48'but I can see why this property attracted Robin, Sue and Chris.'
0:12:50 > 0:12:53This family have obviously fallen in love with this property -
0:12:53 > 0:12:54like I have.
0:12:54 > 0:12:57I think it's great they want to lovingly restore it,
0:12:57 > 0:12:59but character costs,
0:12:59 > 0:13:03and, as a business purchase, you can't let your heart rule your wallet.
0:13:03 > 0:13:07Will the budget be blown? Join me later and you can find out.
0:13:15 > 0:13:18The county of Durham in the North East,
0:13:18 > 0:13:20forever linked with the mining industry.
0:13:20 > 0:13:25But here in Hartlepool, it's the sea that rules,
0:13:25 > 0:13:28with fishing and shipbuilding being the main two industries.
0:13:28 > 0:13:32And here, down on the rejuvenated dockside and quay areas,
0:13:32 > 0:13:37it's also home to Europe's oldest floating fighting ship,
0:13:37 > 0:13:39the Trincomalee.
0:13:41 > 0:13:44You certainly can't miss the maritime history here.
0:13:44 > 0:13:48The new marina feels more Monte Carlo than mining.
0:13:48 > 0:13:51It goes to show that the river is still vital to the town.
0:13:51 > 0:13:56The lot I've come to see is in the very popular central area.
0:13:56 > 0:13:58Here you go. Ex-local authority estate,
0:13:58 > 0:14:01the majority of the properties now in private hands.
0:14:01 > 0:14:05This is the house I'm here to see. It's a two-bedroomed mid-terrace.
0:14:05 > 0:14:07Something a bit unusual.
0:14:07 > 0:14:10This upstairs window is kind of built into the roof.
0:14:10 > 0:14:12It's almost a dormer, but it's not.
0:14:12 > 0:14:16So I've invented a new word for it. It's now called a semi-dormer.
0:14:16 > 0:14:20You won't find it in any of the textbooks, but you heard it here first.
0:14:20 > 0:14:22Let's take a look inside.
0:14:22 > 0:14:27'I know this is not a common term, but it does describe it perfectly.
0:14:27 > 0:14:31'Considering the guide price for this house was just £45,000 to £50,000,
0:14:31 > 0:14:36'I reckon, with or without that semi-dormer, it's not half bad.'
0:14:39 > 0:14:41So, what do you get for your money?
0:14:41 > 0:14:44Through into a little entrance, living room there.
0:14:44 > 0:14:46Doesn't look to be a bad size.
0:14:46 > 0:14:50I'd like to see French doors at the end. Apart from that, it's OK.
0:14:50 > 0:14:54Through to the kitchen. Not a bad size either.
0:14:54 > 0:14:59Total transformation if you put down some nice laminate flooring.
0:14:59 > 0:15:00Units look fairly new,
0:15:00 > 0:15:05although, strangely, it looks like some have actually been taken.
0:15:05 > 0:15:11But enough room for a dining table there to create a lovely breakfast kitchen area.
0:15:11 > 0:15:14Just check that out. A boiler. Looks like that needs servicing.
0:15:14 > 0:15:17But, apart from that, it's a good-size space
0:15:17 > 0:15:21and, a bit of a surprise, I think, a good heart to the house.
0:15:23 > 0:15:25'From what I've seen so far,
0:15:25 > 0:15:29'getting this place up to scratch shouldn't require major surgery.
0:15:29 > 0:15:31'But there is another floor to look at.'
0:15:33 > 0:15:36So, upstairs, big double bedroom there.
0:15:36 > 0:15:38Very pink, that's for sure!
0:15:38 > 0:15:41You've got the bathroom and loo there, which is great.
0:15:41 > 0:15:43No messing around trying to bring it upstairs.
0:15:43 > 0:15:46Into the second double bedroom. A good size.
0:15:46 > 0:15:50Looks like the electrics are slightly dodgy.
0:15:50 > 0:15:55But here we have the advantages of a semi-dormer.
0:15:55 > 0:16:00'It lets in so much light as the window extends up to the roof line.
0:16:00 > 0:16:04'Time to see if a local estate agent agrees with my diagnosis.
0:16:04 > 0:16:06'With a guide price of £45,000 to £50,000,
0:16:06 > 0:16:08'this seems to have plenty to offer,
0:16:08 > 0:16:12'and I can sense a real feeling of rebirth around here.'
0:16:12 > 0:16:14It is an up-and-coming area.
0:16:14 > 0:16:19House prices have risen in this town over the last few years.
0:16:19 > 0:16:21First-time buyers can't afford
0:16:21 > 0:16:24the type of property they would have bought on private estates.
0:16:24 > 0:16:29'This type of property is now more appealing because it is a decent size,
0:16:29 > 0:16:31'they are affordable to the first-time buyers,
0:16:31 > 0:16:34'and they get a nice garden for the family to grow into.'
0:16:35 > 0:16:39'So, will it be a straightforward quick-turnaround job,
0:16:39 > 0:16:44'or would you be better to splash the cash and do this place up?'
0:16:45 > 0:16:48'I think the property is an interesting proposition.
0:16:48 > 0:16:53'With a bit of TLC, it could be brought up to a lovely standard.'
0:16:53 > 0:16:57'The question is, would it be worth that financial outlay?'
0:16:57 > 0:16:59Once this property has been modernised,
0:16:59 > 0:17:04I'd expect it to get a rental price of around £425 per calendar month.
0:17:04 > 0:17:09And for resale, it should achieve around £69,950, early £70,000.
0:17:09 > 0:17:13'That would represent £20,000 over the upper guide price
0:17:13 > 0:17:16'for a property that seems to need very little work,
0:17:16 > 0:17:18'at least on the inside.'
0:17:19 > 0:17:22So, all in all, a nice enough little house.
0:17:22 > 0:17:25And for that guide price of £40,000 to £45,000,
0:17:25 > 0:17:27I don't think you can go too far wrong.
0:17:27 > 0:17:30Let's see who agreed with me when it went under the hammer.
0:17:31 > 0:17:35Lot 162 takes us to Hartlepool, No.9 Falkirk Road,
0:17:35 > 0:17:38two-bedroom accommodation, vacant possession.
0:17:38 > 0:17:40Two telephone bids. Where shall we begin? 40?
0:17:40 > 0:17:43Thank you. Shout away. 40,000. 41, may I say?
0:17:43 > 0:17:4540 I have. 41. 42? 42.
0:17:45 > 0:17:4743? 43. 44?
0:17:47 > 0:17:4944. 45? 45.
0:17:49 > 0:17:5246? 46. 47? 47.
0:17:52 > 0:17:5448?
0:17:54 > 0:17:57No. 47 I have. 48 anywhere else?
0:17:57 > 0:17:59For the first time 47.
0:17:59 > 0:18:01Second time 47.
0:18:01 > 0:18:0348. 49?
0:18:03 > 0:18:0549. 50?
0:18:05 > 0:18:09No? 49 with you against two of you in the room and on the phones.
0:18:09 > 0:18:1149,000 for the first time.
0:18:11 > 0:18:13For the second time.
0:18:13 > 0:18:17For the third and final time at £49,000...
0:18:17 > 0:18:2150. You almost missed out there. 50 with you. Either of you, 51?
0:18:21 > 0:18:22No, I won't take a half.
0:18:22 > 0:18:25It's with you, sir, on my right at 50,000 for the first time.
0:18:25 > 0:18:29For the second time. Third and final time at £50,000.
0:18:29 > 0:18:31Are we all done?
0:18:31 > 0:18:34It's yours, sir. 50,000.
0:18:34 > 0:18:37'For £50,000, at the top of the guide price range,
0:18:37 > 0:18:39'the new owner is Alan.
0:18:39 > 0:18:43'He's the director of a building and lettings management company.
0:18:43 > 0:18:48'I met him at his new purchase to find out about his plans for it.'
0:18:48 > 0:18:52Alan, congratulations. Tell me why you wanted to buy the house.
0:18:52 > 0:18:54We know the area very well.
0:18:54 > 0:18:58- We manage about 15 houses on this estate.- Oh, really? Wow.
0:18:58 > 0:19:02We have bought quite a number over the years, so we know it.
0:19:02 > 0:19:05We know the rent levels, we know the type of people,
0:19:05 > 0:19:09and we know exactly what type of work this house will need.
0:19:09 > 0:19:12- Very good local knowledge, then. - Yes.
0:19:12 > 0:19:16What is interesting is that this was actually in a London auction.
0:19:16 > 0:19:19Tell me the circumstances around that.
0:19:19 > 0:19:22We noticed the property was for sale locally
0:19:22 > 0:19:25but, because it was going to auction,
0:19:25 > 0:19:28it's preferable for me to go to the auction and buy it
0:19:28 > 0:19:30instead of going through an agent.
0:19:30 > 0:19:34I've tried internet and telephone bidding. I wasn't happy with them.
0:19:34 > 0:19:39Particularly this house, I think if I hadn't been in the room, I wouldn't have managed to get it.
0:19:39 > 0:19:41So it's worth the trip to London for you.
0:19:41 > 0:19:45For the cost of a train fare, it's negligible for the property.
0:19:45 > 0:19:48A lot of repossessions don't go to local auctions.
0:19:48 > 0:19:50When they do, the houses go for too much.
0:19:50 > 0:19:53When it goes to London, it's normally investors who are buying,
0:19:53 > 0:19:56not owner-occupiers, people who want to live in the house.
0:19:56 > 0:19:58So your competition's different.
0:19:58 > 0:20:03In addition to that, a lot of people in the South will buy a house without viewing.
0:20:03 > 0:20:07They won't travel up to see it and don't know what they're buying.
0:20:07 > 0:20:12- That makes them more cautious, so you've got a better chance of competing with them.- Right.
0:20:12 > 0:20:17So you think this would have been more expensive had it been in a local auction.
0:20:17 > 0:20:20Yes, cos a lot more people would have been looking at it.
0:20:20 > 0:20:23It could have been just about £3,000 to £5,000,
0:20:23 > 0:20:25which would have not made it profitable.
0:20:25 > 0:20:27'That's very interesting indeed.
0:20:27 > 0:20:29'A tried and tested formula for Alan,
0:20:29 > 0:20:34'which also has implications for properties from elsewhere in the country
0:20:34 > 0:20:36'that go to auction in London.'
0:20:38 > 0:20:40Tell me a bit more about you.
0:20:40 > 0:20:43I've been doing property development for about 10 years.
0:20:43 > 0:20:48Originally we started out buying the odd house to renovate to sell.
0:20:48 > 0:20:54Then we got some contacts who wanted us to buy houses on their behalf.
0:20:54 > 0:20:56So we started developing that side more,
0:20:56 > 0:21:00moved into property management so they'd buy more properties from us,
0:21:00 > 0:21:05- and it's developed from there. - How many properties do you manage now?- About 200.
0:21:05 > 0:21:07Oh, blimey!
0:21:07 > 0:21:12We don't buy and sell as much as we used to because of the changes in the marketplace.
0:21:12 > 0:21:16It's only in the last four months that we've gone back into buying.
0:21:16 > 0:21:19It's now more possible to obtain a decent property at a good price.
0:21:20 > 0:21:23'As every successful property developer knows,
0:21:23 > 0:21:25'the numbers have to add up.
0:21:25 > 0:21:28'Alan's company manages 200 properties,
0:21:28 > 0:21:32'of which 25 are in his own personal portfolio.
0:21:32 > 0:21:34'And this is number 26.'
0:21:34 > 0:21:38- So, what are you going to do to this place?- Not a great deal.
0:21:38 > 0:21:39- Really?- Luckily, yeah.
0:21:39 > 0:21:42The kitchen needs a revamp. Most of it is straightforward.
0:21:42 > 0:21:44We'll improve, add more units.
0:21:44 > 0:21:48A good clean-out, new carpets, lino, a bit of decorating,
0:21:48 > 0:21:50but that's all it needs.
0:21:50 > 0:21:54And the idea is then to what, sell it or to rent it out?
0:21:54 > 0:21:55Rent it out immediately
0:21:55 > 0:22:00and then potentially sell it on to another investor, with a sitting tenant.
0:22:00 > 0:22:02Any idea what you'll get in terms of rent?
0:22:02 > 0:22:03About £450 a month.
0:22:03 > 0:22:06In terms of what you paid for it, that's a fairly good yield.
0:22:06 > 0:22:11- Over 10%.- Can't get that at the bank at the moment, can you!
0:22:12 > 0:22:17'For those figures, that return fare to London looks like money well spent to me.
0:22:17 > 0:22:21'Alan's pretty optimistic that auction rooms are the place to be.'
0:22:22 > 0:22:26There is a lot more houses selling than there was a year ago.
0:22:26 > 0:22:31I went to auctions a year ago when less than 50% of properties were selling at an auction.
0:22:31 > 0:22:33Now it looks like nearly 80-90% selling.
0:22:33 > 0:22:37So there's more movement. There's a lot more people buying.
0:22:37 > 0:22:39There's more competition, though.
0:22:39 > 0:22:42So how much is it going to cost to get the house up to scratch?
0:22:42 > 0:22:43Couple of thousand.
0:22:43 > 0:22:46Will a team of people do that, or will you be involved?
0:22:46 > 0:22:49I may get involved, but not always. Depends how busy I am.
0:22:49 > 0:22:52I don't get my hands dirty too much these days,
0:22:52 > 0:22:55so we'll get a few contractors to do the work we require.
0:22:55 > 0:22:58- What timescale are you looking at? - Two weeks.
0:22:58 > 0:23:01- Two weeks before you get somebody in here?- Yeah.- Wow.
0:23:01 > 0:23:03Well, congratulations. Good luck.
0:23:03 > 0:23:07And thanks for the insight. Fascinating. Good to meet you.
0:23:08 > 0:23:12'Well, Alan's got an eye for a property - and a bargain.'
0:23:13 > 0:23:17So, some interesting tips there about buying a property
0:23:17 > 0:23:21that's in an auction outside the area where it's located.
0:23:21 > 0:23:23Something certainly worth considering.
0:23:23 > 0:23:27So, Alan's got the experience to do this place up, no problem.
0:23:27 > 0:23:30But still, £2,000 - that's a tight budget.
0:23:30 > 0:23:32And in just two weeks!
0:23:32 > 0:23:35Will he do it? You can find out later in the show.
0:23:36 > 0:23:38'Coming up,
0:23:38 > 0:23:42'you might be tempted to rearrange the layout of this London flat, but...'
0:23:42 > 0:23:45If it's not broken, perhaps don't fix it.
0:23:46 > 0:23:48'Back in Hartlepool,
0:23:48 > 0:23:52'is it the budget or the valuations that pleased our developer?'
0:23:52 > 0:23:56Those figures were virtually the same as what I had anticipated.
0:23:57 > 0:23:59'But first we return to Southampton,
0:23:59 > 0:24:01'where they've been watching the budget.
0:24:01 > 0:24:05I'd like to do it inside 10 for the rest of it, and we should be able to.
0:24:08 > 0:24:10'Back to trendy Oxford Street now.
0:24:10 > 0:24:13'No, not the one in London, the one in Southampton,
0:24:13 > 0:24:18'where husband and wife property developer team Robin and Sue and their son Chris
0:24:18 > 0:24:24'bought this lovely Georgian town house at auction for £250,000.
0:24:25 > 0:24:28'The property had been split into two separate flats,
0:24:28 > 0:24:32'although it's still shown on the title deeds as one house.
0:24:32 > 0:24:35'Most of the original character detail was missing,
0:24:35 > 0:24:42'so Robin, Sue and Chris planned a thorough £15,000 renovation in the bottom flat
0:24:42 > 0:24:43'to put a lot of it back.
0:24:43 > 0:24:47'They intended a basic £5,000 makeover on the top flat,
0:24:47 > 0:24:52'and then to let them both out as quickly as possible.
0:24:52 > 0:24:56'Ten months on, plans seem to have changed a bit.
0:24:56 > 0:25:01'The top flat has had a much bigger refit than I expected.'
0:25:01 > 0:25:03We started working on it,
0:25:03 > 0:25:08and we'd decided that we could make it reasonable to let.
0:25:08 > 0:25:12But then we got a bit carried away, interest rates dropped,
0:25:12 > 0:25:14we saw some good deals with kitchens
0:25:14 > 0:25:18and, after all the effort of stripping all that wallpaper,
0:25:18 > 0:25:22discovered some plaster was damaged that really needed replastering
0:25:22 > 0:25:24and thought, "This is crazy.
0:25:24 > 0:25:27"We might just as well do the whole thing."
0:25:30 > 0:25:31'So that's what they've done.
0:25:31 > 0:25:35'New coving, new skirting, new doors, new electrics,
0:25:35 > 0:25:37'and central heating.
0:25:37 > 0:25:40'Since Chris is a trained cabinet maker,
0:25:40 > 0:25:44'he's taken responsibility for some of the more involved jobs.'
0:25:46 > 0:25:49As you can see, there's a brand-new kitchen in here.
0:25:49 > 0:25:51The old one wasn't very nice,
0:25:51 > 0:25:55but we have actually managed to recycle most of it.
0:25:55 > 0:25:58We got this kitchen at a bargain price from somewhere that closed down.
0:25:58 > 0:26:00We've got lovely bamboo worktops.
0:26:00 > 0:26:04Some of it we got from somewhere else cos there wasn't quite enough.
0:26:04 > 0:26:06It's got nice appliances.
0:26:06 > 0:26:09Everything you need, from a warming drawer to a dishwasher,
0:26:09 > 0:26:11and everything else, yeah.
0:26:12 > 0:26:16'Sue had the task of sourcing most of the materials in this project.
0:26:16 > 0:26:19'The living room in the upstairs flat is a good example
0:26:19 > 0:26:22'of how her research has been put to great effect.'
0:26:25 > 0:26:30This room we basically stripped completely back to the bare walls.
0:26:30 > 0:26:34It was covered in woodchip, so we removed all of that.
0:26:34 > 0:26:36There was no fireplace there,
0:26:36 > 0:26:37just a hole,
0:26:37 > 0:26:40so we've sorted that one out now,
0:26:40 > 0:26:46had new skirting board made that copies what's on the stairway.
0:26:46 > 0:26:51There was a horrible bullnosed architrave all round the window,
0:26:51 > 0:26:55which we've managed to source, and done the same around the doorway.
0:26:55 > 0:26:57The coving - there was none here at all,
0:26:57 > 0:27:00and it took a bit of research to find something
0:27:00 > 0:27:05that would complement the architrave round the window
0:27:05 > 0:27:08and also was in keeping with the house.
0:27:08 > 0:27:12This wasn't a particularly grand house originally, but a town house.
0:27:12 > 0:27:15But it still would have had all those features.
0:27:15 > 0:27:18But I like a little impact and put the chandelier in.
0:27:19 > 0:27:21'Sue has put so much time into this project
0:27:21 > 0:27:23'that I can't help wondering,
0:27:23 > 0:27:26is she still thinking about moving in herself?'
0:27:26 > 0:27:28I had suggested it
0:27:28 > 0:27:31because we've got a project going on at our own home.
0:27:31 > 0:27:36- It's worth considering.- Could be expensive with all those pubs and restaurants on the doorstep.
0:27:39 > 0:27:42'It sounds like Robin remains to be convinced!
0:27:42 > 0:27:46'But with the top flat very nearly finished and ready to rent out,
0:27:46 > 0:27:48'it will soon be time to make a decision.
0:27:48 > 0:27:51'The same can't be said for the bottom flat, though.'
0:27:56 > 0:28:00Well, the main progress is the wallpaper's been stripped,
0:28:00 > 0:28:05and there's more mess because it's become a storage area for all that's going on elsewhere.
0:28:05 > 0:28:09A lot of the magnolia and woodchip has gone.
0:28:09 > 0:28:12Quite a lot of replastering has been done as well.
0:28:14 > 0:28:16'So some of the work here was underway.
0:28:16 > 0:28:21'But Robin thinks there's another four or five months of finishing off to do.
0:28:21 > 0:28:23'While Sue's been buying for the top flat,
0:28:23 > 0:28:26'she's also managed to prepare for this one.
0:28:26 > 0:28:30'They now have a pretty good idea of their final budget.
0:28:30 > 0:28:35'Originally they hoped to spend £20,000 on renovating both flats,
0:28:35 > 0:28:39'but, as their plans changed, the budget has risen dramatically.'
0:28:39 > 0:28:41It's at about £40,000 now.
0:28:41 > 0:28:44We've bought most of the stuff for downstairs.
0:28:44 > 0:28:46It'll finish at about £50,000 spent on it.
0:28:46 > 0:28:48So a total cost of £300,000.
0:28:51 > 0:28:53'But how much will it be worth?
0:28:53 > 0:28:57'We asked two local estate agents along to tell us.'
0:28:58 > 0:29:00I think the property is stunning.
0:29:00 > 0:29:01The standard of finish is very good.
0:29:01 > 0:29:05Obviously there's still a fair bit to be done,
0:29:05 > 0:29:07but I think the finished product will be very nice.
0:29:07 > 0:29:10I think the owners have done a really nice job.
0:29:10 > 0:29:15I particularly like that they've tried to retain or replicate
0:29:15 > 0:29:18some of the original features of the period.
0:29:18 > 0:29:22They've done a really nice job on the kitchens, and the bathrooms are high-spec,
0:29:22 > 0:29:26which I think buyers certainly are looking for today.
0:29:26 > 0:29:29'So, a big thumbs up from the estate agents.
0:29:29 > 0:29:33'But what could Robin, Chris and Sue expect to make in rental
0:29:33 > 0:29:35'from their £300,000 investment?'
0:29:35 > 0:29:40To rent this, you'd advertise at around £900 per calendar month.
0:29:40 > 0:29:45The basement flat, as long as it's spec'd up to this sort of standard,
0:29:45 > 0:29:47you're probably looking at £825.
0:29:47 > 0:29:50The top flat I would like to see on the market
0:29:50 > 0:29:56at around £1100-£1200 per calendar month on a furnished basis.
0:29:56 > 0:29:59With the bottom flat being slightly smaller,
0:29:59 > 0:30:02I would expect to achieve in the region of £1000 to £1100.
0:30:02 > 0:30:05That was exactly the sort of figures I was thinking.
0:30:05 > 0:30:08We were thinking a corporate let would be ideal,
0:30:08 > 0:30:10and actually to furnish it.
0:30:10 > 0:30:12So that's exactly what we were thinking.
0:30:15 > 0:30:18'So they could see a 7% to 9% rental return
0:30:18 > 0:30:21'on their £300,000 outlay.
0:30:22 > 0:30:26'But if they spent a bit more to split the property at the Land Registry,
0:30:26 > 0:30:28'how much could they sell each flat for?'
0:30:28 > 0:30:32I would expect to see this on the market, the top flat,
0:30:32 > 0:30:37in the region of £215,000 to £220,000.
0:30:37 > 0:30:39With regards to the bottom flat,
0:30:39 > 0:30:42I would expect to see that on the market between £205,000 and £210,000.
0:30:42 > 0:30:44I'd advertise this at around £225,000.
0:30:44 > 0:30:50The basement flat, you'd probably advertise that at around £200,000.
0:30:50 > 0:30:52That's what we were thinking.
0:30:52 > 0:30:55That's exactly the sort of price range that we thought.
0:30:55 > 0:30:58- £200,000.- Yeah, so I'm quite happy about that.
0:30:58 > 0:31:02Especially in this market, if they're valuing at that level.
0:31:04 > 0:31:09'So Robin, Sue and Chris could make over £100,000 pre-tax profit
0:31:09 > 0:31:11'if they decided to sell.
0:31:11 > 0:31:15'But sadly, both estate agents agreed that, in the current market,
0:31:15 > 0:31:19'they couldn't make anything like that from converting it back into one house.
0:31:19 > 0:31:24'So, for now, this place is destined to stay as two flats.'
0:31:32 > 0:31:34# Ride with us
0:31:34 > 0:31:36# On top of a London bus...#
0:31:36 > 0:31:39'I'm in Hackney, East London,
0:31:39 > 0:31:41'which used to be a less-than-desirable area
0:31:41 > 0:31:44'but has now become an up-and-coming hot spot,
0:31:44 > 0:31:47'with galleries and gastropubs on every corner.
0:31:47 > 0:31:50# By bus is best #
0:31:52 > 0:31:55'This gentrification hasn't been without controversy.
0:31:55 > 0:31:58'The arrival of many artists and young professionals
0:31:58 > 0:32:01'has seen property prices soar, forcing the locals out.
0:32:01 > 0:32:04'Despite that, it's a great place to invest -
0:32:04 > 0:32:07'if you can find any bargains left.'
0:32:07 > 0:32:10I'm on Graham Road, a busy thoroughfare
0:32:10 > 0:32:13linking vibrant Hackney to fashionable Islington.
0:32:13 > 0:32:16Despite its slightly scruffy appearance,
0:32:16 > 0:32:20believe me when I say this area is highly desirable,
0:32:20 > 0:32:23as is the guide price for this one-bedroom flat -
0:32:23 > 0:32:25£135,000.
0:32:25 > 0:32:28I know this one-bedroom property on the second floor
0:32:28 > 0:32:33is on the market as we speak for nearly £100,000 more.
0:32:33 > 0:32:35Let's go inside and find out why.
0:32:35 > 0:32:38'The flat I'm here to see is on the top floor,
0:32:38 > 0:32:42'so there aren't lovely bay windows that you get on the lower level.
0:32:42 > 0:32:45'Still, the top floor does provide better security,
0:32:45 > 0:32:48'an important consideration in Central London.
0:32:49 > 0:32:52'Through the front door, and it's not pretty.
0:32:52 > 0:32:55'The entrance hall is in a sorry old state.
0:32:55 > 0:32:58'Once you've climbed flights of dangerous-looking stairs
0:32:58 > 0:33:02'you're greeted with a rotten window on the top landing,
0:33:02 > 0:33:04'which leads to the flat.
0:33:05 > 0:33:08The communal area really leaves a lot to be desired,
0:33:08 > 0:33:11and those stairs slant at an alarming angle.
0:33:11 > 0:33:15It's like walking around in a fun house at a theme park.
0:33:15 > 0:33:18I'd be phoning the freeholder about the mess down there
0:33:18 > 0:33:22and I'd also be calling in a surveyor about this tilt.
0:33:22 > 0:33:26Being on the top floor, it's not got the lovely high ceilings
0:33:26 > 0:33:29I would have hoped for from a Victorian terrace.
0:33:29 > 0:33:33But first impressions, the flat does seem small, but it's neat.
0:33:33 > 0:33:34Let's take a look around.
0:33:35 > 0:33:37The bedroom's not a bad size.
0:33:37 > 0:33:39Look - somebody's left you a bed!
0:33:39 > 0:33:44You've got a big window, but the sash has been replaced, which is a shame.
0:33:44 > 0:33:48And your only air flow is through that vent at the top.
0:33:48 > 0:33:51One slight worry is the damp patch above me on the ceiling.
0:33:51 > 0:33:54That could be just an old stain,
0:33:54 > 0:33:56a historic leak from the roof perhaps.
0:33:56 > 0:33:59It would be worth getting a damp meter reading as soon as possible
0:33:59 > 0:34:02to check that there's nothing more serious.
0:34:02 > 0:34:05'The living room is a similar size to the bedroom,
0:34:05 > 0:34:08'also with a large window overlooking the busy road.
0:34:08 > 0:34:12'But it's just a small louvre window to let air in.
0:34:12 > 0:34:15'One positive: the flat does have central heating.
0:34:15 > 0:34:18'But the bathroom will need a complete overhaul
0:34:18 > 0:34:22'with new appliances, and that hole in the wall needs fixing.'
0:34:22 > 0:34:24It is a decent-size kitchen,
0:34:24 > 0:34:27and the good news is there's space for a table over there.
0:34:27 > 0:34:30That's all you'd need for a one-bedroom flat.
0:34:30 > 0:34:33You could get some white, light-reflective units in here,
0:34:33 > 0:34:35perhaps some wooden worktops,
0:34:35 > 0:34:37and you'd really transform it.
0:34:37 > 0:34:41Or maybe you could think about reorganising this space
0:34:41 > 0:34:43and put the kitchen in the living room,
0:34:43 > 0:34:47knock through to the bedroom and create a kitchen-diner,
0:34:47 > 0:34:49and make this area the bedroom.
0:34:49 > 0:34:53I'm not sure, though. I do like the proportions of this flat.
0:34:53 > 0:34:55The layout is practical and it works.
0:34:55 > 0:34:58If it's not broken, perhaps don't fix it.
0:34:59 > 0:35:04'Why get all steamed up and risk putting your budget in hot water?
0:35:04 > 0:35:08'But moving the bedroom to the back of the flat would make it much quieter
0:35:08 > 0:35:11'away from the noisy road.
0:35:11 > 0:35:14'As it is, I don't think you'd need to spend a fortune
0:35:14 > 0:35:16'to bring this Hackney pad up to scratch.
0:35:16 > 0:35:19'I've asked a local estate agent to have a look at the flat
0:35:19 > 0:35:21'and see what he thinks.'
0:35:23 > 0:35:26'In the current climate, people want period features.'
0:35:26 > 0:35:30Any reverting back to its original state would increase the value.
0:35:30 > 0:35:34I'd put the sash windows back in to the front of the property,
0:35:34 > 0:35:39put in a new kitchen and bathroom, and I think it would resell very well.
0:35:39 > 0:35:43Or, if you've got a buy-to-let investor, it would rent as well.
0:35:43 > 0:35:46- So both sides of the coin would be covered. - KER-CHING!
0:35:46 > 0:35:51'Speaking of coins, how do the values stack up?'
0:35:51 > 0:35:55In these current conditions, I think it'd be worth £150,000.
0:35:55 > 0:36:01But with the improvements that I've suggested, I think you could get as much as £200,000.
0:36:01 > 0:36:02For rental purposes,
0:36:02 > 0:36:07you could achieve between £700 and £800 per calendar month.
0:36:08 > 0:36:11'So, for a £10,000 to £15,000 spend,
0:36:11 > 0:36:14'you could make about £50,000 profit.
0:36:14 > 0:36:17'It all depends on whether it would sell in this market,
0:36:17 > 0:36:22'but with around a 7% return on rental, that's promising too.'
0:36:22 > 0:36:25I said bargains were scarce around here,
0:36:25 > 0:36:27but I think I've found one.
0:36:27 > 0:36:29Before the property market turmoil,
0:36:29 > 0:36:33you wouldn't have found a studio flat in this area at such a low price.
0:36:33 > 0:36:37It will be easy to add value here, and it will rent out in an instant.
0:36:37 > 0:36:42Anywhere near the guide price and this flat is a complete steal.
0:36:42 > 0:36:44Let's see who snapped it up in the auction room.
0:36:44 > 0:36:47Lot 79
0:36:47 > 0:36:53is 102D Graham Road, Hackney, London E8.
0:36:53 > 0:36:57It's a well-located one-bedroom flat at the heart of Hackney.
0:36:57 > 0:37:00What shall we say? 130, anybody?
0:37:00 > 0:37:03Looking for 130. Who wants to give me a start?
0:37:03 > 0:37:07How about 100? Immediate discount.
0:37:07 > 0:37:0990. OK, we'll take it.
0:37:09 > 0:37:11Got £90,000.
0:37:11 > 0:37:13Anybody else? 95. Thank you.
0:37:13 > 0:37:16100.
0:37:16 > 0:37:17105.
0:37:17 > 0:37:19110.
0:37:19 > 0:37:20115.
0:37:20 > 0:37:22120?
0:37:22 > 0:37:24116, then.
0:37:24 > 0:37:26117.
0:37:26 > 0:37:28118.
0:37:28 > 0:37:29119.
0:37:29 > 0:37:33120.
0:37:33 > 0:37:35121.
0:37:35 > 0:37:36122.
0:37:36 > 0:37:38123.
0:37:38 > 0:37:39124.
0:37:39 > 0:37:42125?
0:37:43 > 0:37:45We'll take 500. If not... Yes? No?
0:37:45 > 0:37:48If not, 124 for the first.
0:37:49 > 0:37:54Oh, hello there. Sorry. 125. More competition.
0:37:54 > 0:37:56126?
0:37:56 > 0:37:57One more?
0:37:57 > 0:38:00126?
0:38:00 > 0:38:05If not, first bid, £125,000 against you at the back of the room.
0:38:05 > 0:38:08125 for the first.
0:38:08 > 0:38:10125 for the second.
0:38:10 > 0:38:14125 for the third and final time. Are we all done?
0:38:14 > 0:38:16Sold. Well bid. 125,000.
0:38:16 > 0:38:19'Ruby and Antonio were the successful purchasers
0:38:19 > 0:38:24'who paid £125,000 for that top-floor flat in Hackney.
0:38:24 > 0:38:28'They'd gone to the auction looking for somewhere for their son Dean.'
0:38:28 > 0:38:31Ruby and Antonio, congratulations.
0:38:31 > 0:38:34I can't believe you paid £125,000 for this.
0:38:34 > 0:38:36That's below the guide price.
0:38:36 > 0:38:39Yeah, absolutely. We thought it would go much higher.
0:38:39 > 0:38:41But it worked out very well.
0:38:41 > 0:38:44So did you go to auction to buy this flat?
0:38:44 > 0:38:46Not really. We had two in mind.
0:38:46 > 0:38:49One was the one at Highbury,
0:38:49 > 0:38:51and then this one.
0:38:51 > 0:38:54And then the Highbury one went so high.
0:38:54 > 0:38:57I was talking to Ruby and especially Dean.
0:38:57 > 0:38:59I said, "What do you think we should do?
0:38:59 > 0:39:02"Do you think we've got a chance with Graham Road?"
0:39:02 > 0:39:04So were you buying this property for your son?
0:39:04 > 0:39:06Yes. Very much for Dean.
0:39:06 > 0:39:08Why?
0:39:08 > 0:39:11Because he is the youngest,
0:39:11 > 0:39:16and we feel that now that we are not working, he needs a good start.
0:39:16 > 0:39:19- How does Dean feel about this? - He is very excited.
0:39:19 > 0:39:22And moreover because we got a good bargain.
0:39:22 > 0:39:24'A bargain it certainly was.
0:39:24 > 0:39:27'Dean may not end up living here himself
0:39:27 > 0:39:29'as he prefers somewhere nearer to work.
0:39:29 > 0:39:33'But I'm sure the rental income will come in very handy for him.'
0:39:33 > 0:39:37Tell me what you think you might do to change the layout of this flat
0:39:37 > 0:39:39or to improve it.
0:39:39 > 0:39:43I would very much like to change the whole flat,
0:39:43 > 0:39:46make it really lovely and modern.
0:39:46 > 0:39:48But one of the things I have in mind is,
0:39:48 > 0:39:52because the entrance and the steps and everything is not very good,
0:39:52 > 0:39:59I'm hoping that the freeholder will either give everyone a share of the freehold
0:39:59 > 0:40:00or sell it to me, maybe,
0:40:00 > 0:40:03and then we can get the whole building done up.
0:40:03 > 0:40:07The communal areas, Ruby, really let this flat down, don't they?
0:40:07 > 0:40:09Yes.
0:40:09 > 0:40:15But I think we should be able to do something good with this place.
0:40:15 > 0:40:17Have you thought about changing the layout?
0:40:17 > 0:40:22Perhaps knocking a few walls down, moving the kitchen to the front?
0:40:22 > 0:40:25No, I don't think so. I prefer the kitchen as it is.
0:40:25 > 0:40:28But just modernise it.
0:40:28 > 0:40:30But what we'll need to do is the bathroom.
0:40:30 > 0:40:35The whole bath has to be changed, so everything new in there,
0:40:35 > 0:40:38a totally new set-up there.
0:40:38 > 0:40:42Well, I feel, if we get a freehold, I would like to expand.
0:40:42 > 0:40:47But that all depends on what happens with the freeholder.
0:40:47 > 0:40:49'I think that's a good tactic.
0:40:49 > 0:40:53'If you control the freehold, you can take matters into your own hands.
0:40:53 > 0:40:58'Antonio and Ruby are aware that the roof needs checking because of the damp patch in the bedroom.'
0:40:58 > 0:41:04What sort of budget have you got to spend on this flat?
0:41:04 > 0:41:06- £15,000 to £20,000?- Maximum.
0:41:06 > 0:41:08£20,000 is around the maximum.
0:41:08 > 0:41:11One thing that does concern me is,
0:41:11 > 0:41:16structurally, this whole place leans inwards, doesn't it?
0:41:16 > 0:41:20You can feel the floors are wobbly, the staircase is a bit rickety.
0:41:20 > 0:41:25- Did you get a structural survey on the property?- No, we did not.
0:41:25 > 0:41:28So why did you not think about getting a structural survey?
0:41:28 > 0:41:32If it was a house, I definitely would have done, but it's a flat.
0:41:32 > 0:41:37On hindsight maybe I made a mistake but, you know, it's a gamble.
0:41:37 > 0:41:39I've always believed in taking a risk,
0:41:39 > 0:41:42and this is a risk - worth it, maybe.
0:41:42 > 0:41:47If I was buying a house, maybe different, absolutely.
0:41:47 > 0:41:51And are you guys going to be involved with the refurb here?
0:41:51 > 0:41:54We will. He is good at it.
0:41:54 > 0:41:58Both of us together are good at it, I must say.
0:41:58 > 0:42:03'But some major work, like the electrics and things like that,
0:42:03 > 0:42:06'we'll have to have professionals coming in.'
0:42:06 > 0:42:12Another thing that I always think - "Top floor flat, three flights of stairs, you need a skip..."
0:42:12 > 0:42:15It's a lot of work to carry a lot of things out,
0:42:15 > 0:42:17and then you've got to carry a lot of things up.
0:42:17 > 0:42:20That's going to be quite a big job for you both.
0:42:20 > 0:42:25I know we may seem a bit older,
0:42:25 > 0:42:28but I've got lots of energy.
0:42:28 > 0:42:31I feel I'm only 30, believe me or not.
0:42:31 > 0:42:34Some people say I'm much older, but I don't believe that.
0:42:34 > 0:42:37- You don't look a day over 30. - Oh, my God! You believe that?
0:42:37 > 0:42:42- And I bet you're fit as a fiddle. - Absolutely! Ready for anything.
0:42:42 > 0:42:47'I hope that's not tempting fate, because there are plenty of signs in the flat
0:42:47 > 0:42:50'that lead me to think they could be in for some surprises.'
0:42:50 > 0:42:55Ruby and Antonio are a lovely couple and make a great team.
0:42:55 > 0:42:58Their son Dean is a lucky boy.
0:42:58 > 0:43:00I am concerned about the lack of survey,
0:43:00 > 0:43:05but I think: obtain the freehold and the gamble on this flat will really pay off.
0:43:05 > 0:43:08Find out how they get on later in the show.
0:43:11 > 0:43:14Once you've bought a property, the challenge is to add value to it.
0:43:14 > 0:43:18Project-managing renovations is not always as easy as it looks.
0:43:18 > 0:43:20Let's find out how today's buyers got on.
0:43:23 > 0:43:26'We return to Hartlepool in the North East now
0:43:26 > 0:43:31'where Alan paid £50,000 for this multicoloured house.
0:43:31 > 0:43:36'He's director of a building and lettings company that manages over 200 rentals.
0:43:36 > 0:43:41'This one would add to his personal portfolio of 25 properties.'
0:43:41 > 0:43:45# I drove all night to get to you...#
0:43:46 > 0:43:51'And now, after just one month, the quick makeover is complete.
0:43:56 > 0:43:58'It's largely been a splash of paint,
0:43:58 > 0:44:02'but those knotted curtains in the living room do now hang down.
0:44:03 > 0:44:08'Upstairs, thankfully the bedroom colours have been toned down.
0:44:10 > 0:44:16'And check out the bathroom - new tiles and laminate flooring.'
0:44:16 > 0:44:19We haven't had to do very much in the house at all.
0:44:19 > 0:44:23Mostly just quick decoration, clean-up,
0:44:23 > 0:44:26the bathroom had a bit of tiling, the kitchen's done,
0:44:26 > 0:44:28cleaned up the gardens - that's it, very simple.
0:44:28 > 0:44:30The house was very quick to turn round.
0:44:30 > 0:44:33'And that's exactly what buy-to-let investors want.'
0:44:33 > 0:44:37This is the kitchen. It's the room we've done the most work in.
0:44:37 > 0:44:38It's still not a great deal.
0:44:38 > 0:44:43We replaced the top units that were missing when we got the property.
0:44:43 > 0:44:47We replaced the oven, hob and extractor.
0:44:47 > 0:44:49The rest was just tidying up tiles and splashbacks.
0:44:49 > 0:44:52The whole house has been turned round for under £1800.
0:44:53 > 0:44:56'That sounds impressive, but Alan's only tidied up here.
0:44:56 > 0:45:00'The main work's taking place in the kitchen and bathroom.
0:45:00 > 0:45:03'His original budget was about £3,000
0:45:03 > 0:45:06'because he thought the boiler might need replacing,
0:45:06 > 0:45:08'and one electrical socket needed attention.
0:45:08 > 0:45:11'But the boiler and electrics were checked and are fine.
0:45:11 > 0:45:14'Remember, Alan travelled down to a London auction
0:45:14 > 0:45:17'where he paid £50,000 for the house,
0:45:17 > 0:45:21'and he's learnt to watch every penny.'
0:45:21 > 0:45:23I'm very cautious when I'm planning a house.
0:45:23 > 0:45:27Most people don't take into account the solicitor's fees, survey fees,
0:45:27 > 0:45:29minor expenditure.
0:45:29 > 0:45:34Everything's got to be put right before you can tell if you're going to make money or not.
0:45:34 > 0:45:37'That's the aim for any buy-to-let businessman.
0:45:37 > 0:45:42'And Alan's already found a tenant willing to lend a hand.'
0:45:42 > 0:45:46We had a large number of people interested in the property.
0:45:46 > 0:45:49Luckily we found a tenant willing to do the decorating himself.
0:45:49 > 0:45:53We find that, if we give someone work to do in the house,
0:45:53 > 0:45:55they're likely to look after it better.
0:45:55 > 0:45:59Also, it keeps our costs down as we're just providing the materials.
0:45:59 > 0:46:02'With over nine years' experience of lettings,
0:46:02 > 0:46:06'Alan knows how important it is to make an accurate inventory
0:46:06 > 0:46:08'of any property he lets out.'
0:46:09 > 0:46:12We always take a written inventory,
0:46:12 > 0:46:15and we normally use a digital camera
0:46:15 > 0:46:18to take photographs of every little detail in the property.
0:46:18 > 0:46:23It stops arguments at the end of the tenancy if we have to go to court over a problem.
0:46:23 > 0:46:26It resolves it before it gets too far.
0:46:27 > 0:46:30# If I had a photograph of you...#
0:46:30 > 0:46:35'That protection is good news for anyone leaving rented accommodation,
0:46:35 > 0:46:39'but I'd always advise you to check and agree the inventory
0:46:39 > 0:46:41'when you first sign your tenancy agreement.
0:46:41 > 0:46:45'So, apart from the photos, what else has Alan done here?'
0:46:47 > 0:46:52I try not to get too involved much at all.
0:46:52 > 0:46:54My main job was to buy the property.
0:46:54 > 0:46:58A member of staff sourced this, found it and recommended it to me.
0:46:58 > 0:47:01I went to the auction, bid, and then arranged the works.
0:47:01 > 0:47:05That's it. Everybody else does all the running around after me.
0:47:06 > 0:47:10'Time to see what two local estate agents think of Alan's purchase.
0:47:10 > 0:47:12'Has he done enough?
0:47:12 > 0:47:14'How much rental income could he generate?'
0:47:15 > 0:47:19My first impression is, the guy's been in. It's clean and tidy.
0:47:19 > 0:47:21Maybe a bit of extra finish
0:47:21 > 0:47:24could have been applied throughout the property,
0:47:24 > 0:47:26a bit more attention to detail.
0:47:26 > 0:47:31Apart from that, for the line for rentals, it should suffice for the area.
0:47:31 > 0:47:34I think it's quite good. It's clean.
0:47:34 > 0:47:37It's very, very good for rental purposes.
0:47:37 > 0:47:41I don't foresee any problems in that respect at all.
0:47:41 > 0:47:43Saleswise, I would change a few things
0:47:43 > 0:47:47if the gentleman was thinking about getting top value.
0:47:47 > 0:47:52If I was looking at resale and the highest valuation possible,
0:47:52 > 0:47:56there'd be thoughts to recommend the bathroom to be changed,
0:47:56 > 0:47:59a combination boiler to be put in, etc.
0:47:59 > 0:48:03I totally agree. It was aimed purely at the rental market.
0:48:03 > 0:48:07If it's going to be sold, it'll be to another investor who is going to keep it rented.
0:48:07 > 0:48:10No point in spending too much money. It would be a waste.
0:48:10 > 0:48:14'I agree. This is a business, after all.
0:48:14 > 0:48:17'So how much rental income should Alan achieve here?'
0:48:17 > 0:48:24Rental valuation, I'd say between £450 to £475 per calendar month.
0:48:24 > 0:48:29I'd say the rental for this area would be £425 to £450 pcm.
0:48:29 > 0:48:33We looked at the property and said £450, which is what we're charging the tenant,
0:48:33 > 0:48:35and everyone seems happy.
0:48:35 > 0:48:38No point pushing rents too high cos the house ends up empty.
0:48:38 > 0:48:40'How much is the house now worth?
0:48:40 > 0:48:43'Remember, Alan paid £50,000 at the auction
0:48:43 > 0:48:46'and has spent just £1800.
0:48:46 > 0:48:49'So, about £52,000 in total.'
0:48:49 > 0:48:52In my opinion, this property is going to be worth
0:48:52 > 0:48:55between £65,000 and £70,000.
0:48:55 > 0:48:57At the moment, in its current condition,
0:48:57 > 0:49:00I'd value the property at around £65,000.
0:49:00 > 0:49:05If you spend a few extra thousand on a combi boiler and tidy the garden, about £70,000.
0:49:05 > 0:49:09Those figures are virtually the same as what I had anticipated.
0:49:09 > 0:49:14I know the area quite well, so I knew I wouldn't be very far off.
0:49:14 > 0:49:19'Whoa! That's at least £13,000 gross profit after just one month.
0:49:19 > 0:49:24'Even allowing for other expenses that Alan always factors in to his properties,
0:49:24 > 0:49:26'that's a great return.
0:49:26 > 0:49:31'Has he any advice for investors looking to emulate his success?'
0:49:31 > 0:49:34I would recommend anybody getting a property,
0:49:34 > 0:49:37if you're looking probably for the long term,
0:49:37 > 0:49:38you'll always make money.
0:49:38 > 0:49:40It's not a short-term gain.
0:49:40 > 0:49:44Whatever you do, make sure you do enough research
0:49:44 > 0:49:49and have enough capital behind you for those extra problems that you don't expect.
0:49:53 > 0:49:55'Back now to the London suburb of Hackney,
0:49:55 > 0:50:00'where Antonio and his wife Ruby paid £125,000
0:50:00 > 0:50:03'for a one-bedroom top-floor flat in this end of terrace.
0:50:03 > 0:50:07'They bought it to help their son Dean onto the property ladder.
0:50:07 > 0:50:10'The flat wasn't in great condition,
0:50:10 > 0:50:13'and the communal staircase was even worse.
0:50:13 > 0:50:15'But Antonio is a bit of a gambler.
0:50:15 > 0:50:20'He was banking on getting all the other tenants to join him in buying the freehold
0:50:20 > 0:50:22'and then really do the place up.
0:50:23 > 0:50:25'Twelve months have passed
0:50:25 > 0:50:28'and we now meet up again with the couple at the flat.
0:50:28 > 0:50:32'From the outside, the property still looks in a pretty bad state.
0:50:32 > 0:50:37'But on the top floor, there have been major changes to the layout,
0:50:37 > 0:50:39'as Antonio explains.'
0:50:39 > 0:50:46When we first started, I thought the bathroom was in the wrong place.
0:50:46 > 0:50:49We wanted to get a designer and a planner,
0:50:49 > 0:50:53then we decided, "Forget about all that, we'll do it ourselves."
0:50:53 > 0:50:55We decided to go and do it ourselves.
0:50:55 > 0:50:56# It takes two, baby...#
0:50:56 > 0:50:59'So they drew up a new layout for the flat,
0:50:59 > 0:51:02'and the first job was to move the bathroom.'
0:51:03 > 0:51:05The bathroom was here.
0:51:05 > 0:51:11It was enclosed, and there were partitions and a door here.
0:51:11 > 0:51:13It didn't give a lot of room.
0:51:13 > 0:51:15Plus there was no natural light.
0:51:15 > 0:51:20So we thought we'd make the bathroom where the kitchen used to be.
0:51:20 > 0:51:24And that's how we have changed it. We have taken everything out.
0:51:24 > 0:51:26Everything that you see is new.
0:51:26 > 0:51:29With a bigger space it would have been even better,
0:51:29 > 0:51:33but with the space we have, I think we have done a very good job.
0:51:34 > 0:51:36'The original kitchen had a large window at the rear,
0:51:36 > 0:51:39'and that had to be removed.'
0:51:39 > 0:51:42We decided to have half the window for the bath
0:51:42 > 0:51:44and half the window for the kitchen,
0:51:44 > 0:51:46since we wanted more light.
0:51:46 > 0:51:49The boiler was in the bathroom,
0:51:49 > 0:51:54so we had to move the boiler from the bathroom to the kitchen.
0:51:54 > 0:51:59And then we fitted all the new tiling and flooring.
0:51:59 > 0:52:01A neutral colour for the ceiling.
0:52:01 > 0:52:07'Antonio had hoped to get the other tenants on board to buy the freehold jointly,
0:52:07 > 0:52:11'but it's taken him and Ruby almost a year to get the flat to this condition.
0:52:11 > 0:52:14'So why the delay?'
0:52:14 > 0:52:18From the time we bought the flat to the time we started the work,
0:52:18 > 0:52:19it took about eight months.
0:52:19 > 0:52:23The reason for that is that we were hoping to get their agreement,
0:52:23 > 0:52:28we didn't get it, then we decided, no point in waiting any more, let's do the best we can.
0:52:28 > 0:52:31'Without financial support from the other residents,
0:52:31 > 0:52:34'Antonio has only done a quick freshen-up on the stairs.
0:52:34 > 0:52:40'It's the first thing you see, and it remains a bit of a letdown.
0:52:40 > 0:52:45'But Antonio is confident that they'll soon buy the freehold and start work.'
0:52:45 > 0:52:47Do it up properly and...
0:52:47 > 0:52:51'Back in the flat, work has been slow.'
0:52:51 > 0:52:53It has taken quite a bit of time
0:52:53 > 0:52:55because we got different people,
0:52:55 > 0:52:58but either their charges were too high,
0:52:58 > 0:53:02or we couldn't get the guarantee that it would be done properly.
0:53:02 > 0:53:06So in the end we decided we would buy the material ourselves...
0:53:06 > 0:53:08Yes, we bought the material ourselves,
0:53:08 > 0:53:10and there was only labour.
0:53:10 > 0:53:14'So how did that impact on the budget?
0:53:14 > 0:53:18'They'd originally set it between £15,000 and £20,000.'
0:53:18 > 0:53:20We spent... how much was it?
0:53:20 > 0:53:25£17,000? Something like £17,000 we have spent, total.
0:53:25 > 0:53:28'Well, the flat is finished.
0:53:28 > 0:53:31'So is their son Dean going to move in?'
0:53:31 > 0:53:34That's the main reason we bought the flat.
0:53:34 > 0:53:37Unfortunately, when he came here, he started thinking,
0:53:37 > 0:53:43"I don't want to live alone. I want to live with a colleague of mine."
0:53:43 > 0:53:45He wanted a two-bedroom place.
0:53:45 > 0:53:47That's why we changed our minds
0:53:47 > 0:53:50and said, "OK, we'll have to rent it if he doesn't want it."
0:53:50 > 0:53:53'Although Dean said, "No thank you, Dad,"
0:53:53 > 0:53:56'Antonio has had no trouble finding a tenant.
0:53:56 > 0:54:00'Art student Joanna brushed aside the state of the stairs
0:54:00 > 0:54:03'as she could see the potential for herself and a friend.'
0:54:03 > 0:54:07When I came in the entrance hall, I didn't have high expectations.
0:54:07 > 0:54:09It's not attractive downstairs.
0:54:09 > 0:54:12Then, coming up to the top floor, the flat is so bright and light.
0:54:12 > 0:54:14We snapped it up quickly.
0:54:14 > 0:54:17We didn't have much chance to even think about it.
0:54:17 > 0:54:19Even though it's a one-bed flat,
0:54:19 > 0:54:23it can work as a two-bed if we put up our own partition.
0:54:23 > 0:54:27'But what about that nasty stain on the ceiling?'
0:54:27 > 0:54:29There was a damp patch
0:54:29 > 0:54:34because the loft was a haven for the pigeons.
0:54:34 > 0:54:38Unbelievable. I have never seen so many pigeons in the loft.
0:54:40 > 0:54:42'So is Ruby now cooing about the flat,
0:54:42 > 0:54:45'even though Dean's flown the nest?'
0:54:45 > 0:54:51'Actually, I'm very happy because we did it ourselves together,
0:54:51 > 0:54:56and how it's come up, it really is a different thing altogether.
0:54:59 > 0:55:02'Time for two local estate agents to climb those stairs
0:55:02 > 0:55:05'and give their opinions.'
0:55:05 > 0:55:08The standard of work here is good, from what I can see.
0:55:08 > 0:55:10The kitchen's well finished, as is the bathroom.
0:55:10 > 0:55:13They've done well with the limited space available.
0:55:13 > 0:55:15The standard of finish is OK.
0:55:15 > 0:55:20The work surface in the kitchen is good, and the bathroom as well.
0:55:20 > 0:55:25In the property, the communal areas aren't very well maintained.
0:55:25 > 0:55:27I believe this will put some people off.
0:55:27 > 0:55:32'Antonio is letting it out at £205 per week.
0:55:32 > 0:55:33'Is that about right?'
0:55:33 > 0:55:37In the rental market, I think you'd achieve from £220 to £230 a week.
0:55:37 > 0:55:43As a rental value, I believe £220 to £230 a week could be achievable.
0:55:43 > 0:55:45The rent we are getting now is OK.
0:55:45 > 0:55:49When we renew the lease in the future,
0:55:49 > 0:55:52then obviously we'll charge the right rent.
0:55:52 > 0:55:53Now it is a bit low.
0:55:54 > 0:55:56'What about the resale value?
0:55:56 > 0:56:01'He paid £125,000 at auction and spent £17,000 on it,
0:56:01 > 0:56:05'making about £142,000 in total.'
0:56:05 > 0:56:09I think you'd market the property for sale at around £200,000
0:56:09 > 0:56:11to achieve between £180,000 and £190,000.
0:56:11 > 0:56:14I'd expect this property to achieve
0:56:14 > 0:56:16in the region of £200,000 to £210,000.
0:56:16 > 0:56:22I think £200,000 to £210,000 is the right one.
0:56:22 > 0:56:25That's what I think it should be.
0:56:25 > 0:56:27'If they get £200,000,
0:56:27 > 0:56:32'that represents a £58,000 gross profit in 12 months.
0:56:32 > 0:56:35'So Antonio's gamble looks to have paid off.
0:56:35 > 0:56:38'Would they try their hand at an auction again?'
0:56:38 > 0:56:41I think so, knowing my husband.
0:56:41 > 0:56:45We will gamble, but with more preparation
0:56:45 > 0:56:48and more hindsight, more thought.
0:56:48 > 0:56:51If you don't venture, you'll never know.
0:56:53 > 0:56:57That's it for more tantalising tales from the auction rooms.
0:56:57 > 0:57:00- See you soon. - For more homes under the hammer. - Goodbye.
0:57:21 > 0:57:23Subtitles by Red Bee Media Ltd
0:57:23 > 0:57:24E-mail subtitling@bbc.co.uk