Episode 85 Homes Under the Hammer


Episode 85

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Buying property in the traditional way can mean

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being caught up in a chain and long completion periods.

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If you buy at auction, you get really quick results.

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In a matter of weeks, the property is yours.

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Interested? Well, we have three very different properties to whet your appetite today.

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Many of the properties in the auctions need work doing on them before they can be lived in.

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But renovating properties means you can add value and that is always the aim.

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So let's see the three properties that had the magic wand wafted over them today.

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I find myself stooping to new lows in West Looe, Cornwall.

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Look at the ceiling height. That's not going to work, is it?

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This cottage in Canterbury looks straight out of a fairytale. Now, is this cottage charming on the inside?

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Well, no, not really.

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And I put on my detective hat for this three-bedroom semi in Gwent, Wales.

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Now, there's something which is worrying me about this house.

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And it's not that obvious.

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All these properties went to auction.

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We'll find out who bought them and what they paid for them, when they went under the hammer.

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The rugged beauty of the Cornish coast

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is a wonderful sight. Between the many estuaries are some very popular towns, and one of them is West Looe.

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Well, either side of the estuary, Looe is a beautiful place to either live or visit,

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even on a soggy day like today.

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But like everywhere, it has been affected by current uncertainties in the property market.

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Up for grabs was a three-bedroomed cottage, with a guide price of 100,000 to 120,000 quid.

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That's certainly less than it would have been a year ago.

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It's near to the quayside and is one of the older properties in the town.

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It comes with Grade II listing and is in a conservation area.

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Recently, it was a shop and from the outside, it's looking pretty tired.

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What about inside?

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Oh, yuk.

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Let's hope it's drier inside than out, although that doesn't follow in some of the properties I see.

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What have we got?

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Well, downstairs, one main room.

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And straightaway, a very strange ceiling. What is going on here?

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Well, this is obviously the frontage of the old shop.

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That's a decent height there but then the ceiling

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has actually been suspended below a main beam which is going across.

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It's not good, really, cos it really lowers the ceiling height here and makes it feel very claustrophobic.

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Somebody's been thinking what they might like to do with this place.

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There's graffiti on the walls, with things like cupboards and cookers.

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This WOULD be a good place for a kitchen. Let's see what the plans for the rest of the house were.

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Until recently, this property had planning permission for change of use back to a permanent residence.

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However, the key phrase there is "recently", because planning permission has now lapsed.

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So, whoever bought this would have to reapply for it or change it altogether.

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Here on the first floor, the kind of feeling of cramped sort of claustrophobia continues, I'd say,

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but bear in mind, this was probably a fisherman's cottage and it is quaint, you've got to say that.

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One bedroom there. Another bedroom here.

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Lovely old floorboards you could have some fun with, but look at the ceiling height.

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That's not going to work, is it?

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I think you need downlighters in this room. But I like the windows. I like the window seats.

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They would be absolutely beautiful if you stripped those back.

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What isn't so pretty, unless you're into... well, funguses... is this...

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a really nasty case of some kind of rot going on there.

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But just a word of warning. See this here?

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That looks at first glance like dry rot.

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But it isn't. What it is, it's a cobweb that's got dust on it.

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I'll show you dry rot in a minute.

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This is dry rot. Look at the difference.

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It's like long sort of roots of a plant, but the trouble is, those roots

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go through concrete, they go through wood, they destroy a house.

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They call it the cancer of buildings.

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That thing downstairs, not a problem.

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This definitely needs to be sorted out. You get a specialist firm in.

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They'll chop the wall out, treat it with chemicals.

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It's not, you know, the be-all and end-all, but definitely

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it needs to be sorted out by a specialist sooner rather than later.

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There's a lot more to sort out here than just the rot.

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Although someone has made a start on improving this property, in reality, there's still quite a bit to do.

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But as the auctioneer who sold it points out, when renovating,

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you need to be very careful what you change.

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You can bet your bottom dollar

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that the local planning authority, quite rightly, because it's a

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listed building in a conservation area,

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they want to make sure that whatever's done,

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particularly externally, will fit in with the environment around.

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Some while ago, the property was granted planning consent for

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reversion to a whole house, cos obviously, it was partly a shop, as the window gives away.

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That planning consent, having been actioned, albeit...

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by no means finished, means the clock has stopped, and they're fine to carry on with that scheme.

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So, provided you stick to those plans, it's fine to carry on.

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But a word of warning.

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Councils have different definitions of what constitutes work having started.

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So do always check before you start knocking down walls.

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Also, remember that there are other options than making it a family home, particularly in this area.

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Strong holiday demand in this part of Cornwall, this part of the village,

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but of course

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you'll get good weeks but then you won't get hardly anything in the winter

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and every Saturday, you've got to change the sheets.

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So it's a balance between how much hands-on management do you want or do you not really want any?

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Lots to consider, then.

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At that guide price, of £100,000 to £120,000, what would the ceiling value be, once renovated?

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A cautious estimate in the current market

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and as long as they do half a reasonable job, you could be looking at 145...

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145,000, 155,000.

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Well, it's a quaint little place, isn't it, with some lovely features

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like these window seats and you certainly can't knock the location,

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but don't underestimate the amount of effort it's going to take to sort this place out.

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Who was ready to take it on when it went to the auction?

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Who's going to say 90?

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90 somewhere. 90.

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For Lot 95. 90.

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80? Good heavens. 80.

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75, or... We're away.

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75 we've got. 75. 78. 80.

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At 80. In the aisle, 80.

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80 I've got. 80. At 80 for Lot 95. At 80.

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At 80 we've got. Orange shirt, we'll do it.

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At 80,000 for Lot 95. At 80,000 once.

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At 80,000 twice.

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At 80,000 - here we go, being sold at 80,000.

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Yours. That was nice and easy.

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With just two bids, the new owner is quantity surveyor Alan.

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He's snapped this up for much less than the £100,000-£120,000 guide price.

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That would put a smile on anybody's face.

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But when I met him back at the property,

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it turns out it was an even sweeter deal than I first thought.

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I tried to buy it last year for 120.

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-It went on at 185, originally.

-No way.

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Dropped to 165 and I offered 120, but they refused it as a repossession.

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So obviously, the market's dipped down, credit crunch.

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Yeah, so cheap property at 80,000.

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Perhaps the rot scared people away, but if anyone is qualified to sort it out,

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it's Alan, who's been in construction for 23 years.

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He's currently finishing a block of eight apartments which he and his wife, Dee, plan to let out.

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So, are you from here, originally?

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No. I'm from West London, originally. So, moved down in 2000.

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Did the classic, at the time.

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-Jumped out the rat race...

-Really.

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to come down and have an easier lifestyle, maybe not work quite so hard.

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Hasn't quite worked out like that... and so we bought a block of holiday flats

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just literally about half a mile from here and so we've been running that for a few years.

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And in the meantime, I've developed a few houses that I've done for myself.

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So I've not really been out of construction. I've been building since I've been down here.

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But no, so actually now when the market's dipped down,

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I've seen the opportunity to potentially start developing again.

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Snapping up this property for just £80,000 was a good start.

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But he's going to have to put all those years of experience into sorting it out.

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The damp and the rot and everything is quite spectacular, isn't it?

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Yeah. It's got worse, actually, since I last saw the property.

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We'll get a timber treatment specialist in and because the house is in such a state,

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if this was a reasonably good condition house, it would be quite an extensive amount of work.

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But everything needs replacing, anyway, so it's just how far we have to go with it.

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What do you think the biggest challenge is?

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Cos it's listed, the roof has got to be replaced in Delabole slate, again.

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I'm expecting half the timbers on that front roof to need replacing.

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And then actually re-roofing that and actually, also, the front elevation,

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cos it's listed, we've got to have single-glazed wood windows made, so...

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they're a bit more expensive than if I was doing, you know, a domestic house built in the 1980s.

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So it's going to be a bit more expensive on that basis.

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Alan estimates it'll cost around £30,000 to do the work on this cottage as he'll have to source

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original materials in keeping with its Grade II status.

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But when it comes to the finished product, he has some ideas of his own.

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So let's talk about the planning.

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What do you know about history of it and where, actually, is it at?

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Well, obviously, it was originally a house but. I think, back in the '20s or '30s it became a shop.

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And then it did have planning permission which I think has lapsed two or three years ago.

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They actually have started a little bit of work here,

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but as I understand it, because they hadn't got building regulation approval, it isn't considered

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a substantial start and so the planning permission actually has lapsed now.

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Hence I've got to go through the whole process.

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You're starting from scratch, to all intents and purposes.

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Yeah. In some respects, it's to my advantage cos the scheme that was drawn originally...

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I've come up with a slightly better scheme.

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Alan intends to restore this old cottage to a three-bedroom family home.

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But he's taking a gamble, as his plans are not yet approved.

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I've met the conservation officer and the building control officer.

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And because it's listed, fortunately, for the alterations I want to do,

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I haven't got to comply with full building regs.

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The conservation side of the property takes precedence.

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But what they've asked for is actually sort of fully wired, smoke alarms and actually, on some of

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the original timbers in the hallways to be painted with intumescent paint, just to stop the spread of fire.

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So, in some respects, being listed has actually helped me to do what I want to do.

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To help him, Alan has employed the architect who used to have his office in this cottage

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so at least he'll know the layout.

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It could take up to four months before they start work, as Alan still has those flats to finish.

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But there's no rush, which is exactly the pace he moved to West Looe for, in the first place.

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-Are you happy you made the move?

-Oh, fantastic. Yeah.

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Part of the reason was we had our first child, nine years ago.

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So we lived in Iver, just on the edge of Buckinghamshire, you know, just the outside of London.

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And it was a lovely place to live, but it's really nice here, my daughter...

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the children she went to playgroup with, she's gone to primary school,

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she'll go to senior school with them, and it really is a nice cohesive sort of atmosphere down here.

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Everybody knows your business, in a nice way. It's a nice place to live, Looe.

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Yeah. And in fact, it's just the commuting, as well.

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I used to be in the construction industry in London

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and it's two or three hours between sites, you know, in traffic.

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So now I'm working within a two or three mile radius

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of where I live, and on this one we walk into work, so it's much nicer.

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Well, clearly, Alan knows that he's got himself a great bargain here but it certainly is a sign of the times

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in terms of how much it's dropped in price from what it was before.

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Anyway, he's using the fact that it's in a conservation area, and a listed building, to his advantage.

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And hopefully, he'll be able to get that all-important planning permission... but you never know.

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Find out how he gets on later in the show.

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Today, I'm just three miles from Canterbury city centre in a desirable area called Tyler Hill.

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Good schools attract families to this place and its prime position is also a draw.

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The North Downs are just three miles south and you're only five minutes from the coast.

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Walking one day, sailing the next.

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Positively spoilt for choice.

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It's those options that make buying property in this area of Kent so attractive.

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Charming, detached and period property, just some of the buzz words

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used in the auction catalogue to describe today's lot.

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It's also a cottage. And the guide...

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just £120,000-£130,000.

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Judging by that glorious facade, the guide price sounds low but will the inside match up?

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So is this cottage charming on the inside?

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Well, no, not really.

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Lots of woodchip wallpaper everywhere and no lovely features, to speak of...

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although through here into the second reception room, we've got a little brick fireplace which is quite nice.

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And you have got new double-glazed windows which we'll need because that is a noisy road out there.

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But the ceilings are relatively low and the kitchen is disappointing.

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I mean, look at the units and sadly, these units completely

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obscure this window, so you're missing a lot of light there.

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And something that has got the alarm bells ringing is that crack up there.

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That needs further investigation.

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Let's just hope upstairs is a little more promising.

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# You look like an angel... #

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All three bedrooms are a good size, but they come with even more cracks and these are serious.

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It would seem this charming little cottage is starting to show its devilish side.

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# You're the devil in disguise

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# Oh, yes, you are # The devil in disguise. #

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Most subsidence is the result of shrinkage of clay soil.

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During hot weather, large cracks tend to appear in walls, particularly around doors like this...

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and...

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windows, as the soil dries out.

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Now, if the building has shallow foundations and doesn't recover, it'll probably need underpinning.

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Great. Spend some money on putting it right and it'll become much easier to sell.

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Well, no, not necessarily.

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Even though thousands of pounds may have been spent on remedial work, difficulty in finding insurance cover

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can just blight the sale of a perfectly sound property.

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# Devil in disguise... #

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Suddenly, that guide price of 120,000-130,000 doesn't sound too cheap, after all.

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What does a local estate agent make of it?

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Perhaps the over-riding issue with this particular house is subsidence.

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The property has suffered structural movement over time and that's very evidence in the property.

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In terms of the impact that subsidence has on the property,

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one first has to look at whether or not there is insurance in place

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which will enable the works to be done to underpin the property and make it structurally sound.

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The problem is that in a difficult market, blight really bites.

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And where you have a history of subsidence, that can make selling a property quite difficult.

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Not the best appraisal I've heard.

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And I fear it's those issues that will put many buyers off.

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But this can be rectified and if someone does put this cottage right, what could it sell for?

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I think if you're looking to sell this property onto the open market, once all

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fully refurbished, underpinning work and everything else, I suspect that you ought to get £250,000 for it.

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I think with a history of subsidence and the market we're in at the moment,

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I think you'd look to accept £225,000.

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This house requires underpinning and that has negative consequences for its future saleability.

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Suddenly, this charming detached cottage isn't so charming any more.

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Someone found it attractive enough to buy it, though.

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Let's find out who that was at the auction.

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Great opportunity to buy this and refurbish it and repair it, whatever you're going to do.

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You need to buy it first, so where are you going to start me?

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We've guided it at 120-130. Start me at 120.

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Start me at 110, then. Not going less than this. 110. 110. I'm on the way at the back.

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£110,000 is with you. 115, I've got.

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Now 120. 120.

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And five. 125. At £120,000 I've got.

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125 I'm looking for. Are we all done at £120,000? Hands everywhere.

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I've got that gentleman there at 125... sorry, 130.

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I'll take you at 132. 132.

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If you want, 132. And five. 135.

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And 40. And 40. And five.

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And 50. And five. 150.

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£150,000, I've got.

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155 I'm looking for. At £150,000 I'm bid.

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It's obviously going to be sold. 155. 155, back by the stand. 160.

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160. And five. Still in the room.

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It's obviously good value. Just who's going to buy it, at £160,000.

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I'll take two if it helps you. 162.

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Hands out the pocket.

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I thought so. 162. 164. And six.

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At £164,000. Back to you, sir.

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Down the front for the first time.

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It's going to be sold. £164,000 for the second time.

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Are you having another go? Third and final time at £164,000.

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If you're sure you're all done. It's yours, sir, for £164,000.

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Following a bit of a battle, the new owners are Paul and Juliette.

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Once they'd got the keys to the cottage, I met them there to find out what they had planned for it.

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-Paul and Juliette, congratulations.

-Thank you.

-Well done.

-Thank you.

-You got the property.

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-Yep.

-I must say, you're in one of my favourite parts of the world... Canterbury.

-Yeah. We like Canterbury.

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So what was it about this house that made you want to go to auction and buy it?

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I went past it and it sits back from the road and it's a nice cottage. It's detached.

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I like the trees, you know, surrounding it.

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And I've been looking for something for a long time...

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in Whitstable, where I live, really.

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More a holiday let, we was looking for, wasn't we?

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-We was really. Yeah.

-So I saw this, and I like a project, as well. And I thought I'd like to live here.

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So it ticked a lot of boxes for you.

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But you weren't at the auction, were you, Juliette?

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No. I wasn't. We didn't think we'd get it because we have been looking for such a long time.

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And Paul went along with the cheque and I said, oh, well, it'll probably go for a lot more money.

0:19:500:19:54

Because there were so many people looking round when we came round, we thought we don't stand a chance.

0:19:540:19:58

So he went along and I couldn't believe it when he said he had got it.

0:19:580:20:01

Tell me about the day you did your initial viewing on this property.

0:20:010:20:05

-It was on a Friday, wasn't it?

-Yes. It was. Yeah.

0:20:050:20:07

-Juliette doesn't work on a Friday, so we come up and use it as an excuse for some lunch out.

-Yeah.

0:20:070:20:12

And they said come at one o'clock.

0:20:120:20:15

So we come at one o'clock and as soon as we got here, they said, you've only got five minutes.

0:20:150:20:19

-They had another viewing to do, or something.

-They've all got to go.

0:20:190:20:22

So we rushed in and looked round.

0:20:220:20:24

-We liked the garden and the look of the place but there were loads of people, weren't there?

-Yeah.

0:20:240:20:28

And what did you think when you saw it for the first time?

0:20:280:20:31

Well, because I've always lived by the sea, I've always imagined, when

0:20:310:20:34

we retire, I would live in the country. And this is quite nice.

0:20:340:20:36

It's not too far out but you've got the country feel. So I liked it.

0:20:360:20:40

I thought, oh, yes, I could just imagine a white picket fence

0:20:400:20:43

and roses over the porch, when you draw a picture when you're a child.

0:20:430:20:46

-It's certainly got that cottagey feel to it, hasn't it?

-Yeah.

0:20:460:20:50

Paul's been in construction since he left school, but with just five minutes

0:20:500:20:53

to view the cottage, he missed its underlying problems.

0:20:530:20:56

He only found out when they checked the legal pack on the internet.

0:20:560:21:00

# Heaven help me

0:21:000:21:04

# I didn't see # The devil in your eyes... #

0:21:040:21:07

When we downloaded it, we found that there was some subsidence,

0:21:070:21:12

but because I'm in the construction, you know, it didn't bother me too much.

0:21:120:21:16

On hindsight, I should have done more homework.

0:21:160:21:18

-We're a bit impulsive though, aren't we?

-Impulse buys can go very wrong.

0:21:180:21:23

While Paul and Juliette did eventually look at the legal pack,

0:21:230:21:27

it's an important reminder that when buying at auction, checking it is a must.

0:21:270:21:33

But luckily for them, they had a bit of inside knowledge.

0:21:330:21:37

I've got a friend who's a structural engineer.

0:21:370:21:40

So, you know, I've got someone I can consult with, and ask their opinion.

0:21:400:21:45

They sort of put my mind at ease.

0:21:450:21:48

And strangely enough, our friend was actually

0:21:480:21:51

-the one that did the survey on this, 15 years ago, ten years ago...

-Yeah.

0:21:510:21:55

Which was quite unusual, really.

0:21:550:21:58

So, yeah, I knew someone who knew something about the property.

0:21:580:22:01

So I suppose from that point of view I'd done some homework.

0:22:010:22:03

So that's good. You did a little bit of homework there, so I'm not going to tell you off.

0:22:030:22:07

So, although this was bought on a whim, at least Paul has done some research.

0:22:070:22:12

But even with his experience in the building trade, I'm worried about the cost of fixing this place.

0:22:120:22:19

I allow a contingency of about 20,000.

0:22:190:22:21

OK. £20,000. Also, you've got to think about the renovation costs because it does need a bit of work.

0:22:210:22:26

Yeah. 20,000 for the underpinning.

0:22:260:22:28

I would allow for

0:22:280:22:31

the drive and the cross over, about 5,000.

0:22:310:22:33

The bathroom and the kitchen and decorating...

0:22:330:22:37

probably about another sort of 12,000.

0:22:370:22:39

So, 37,000.

0:22:390:22:41

-37. Yeah.

-Yeah.

0:22:410:22:43

So, guys, that brings the total of this house up to £201,000.

0:22:430:22:47

-Do you think, in the current climate, this house is worth that?

-Oh, yeah.

0:22:470:22:51

Definitely. It's a lovely location.

0:22:510:22:54

Detached. No neighbours.

0:22:540:22:56

No. It's very desirable, I think.

0:22:560:22:57

-Yeah. I think so. Yeah.

-But to start with, we're only really going to...

0:22:570:23:01

it's a long-term plan...

0:23:010:23:02

so to start with, sort out the essential things that need doing, and then perhaps we'll

0:23:020:23:07

consider renting it until we're ready to actually do it exactly how

0:23:070:23:10

we want to renovate the cottage, ourselves, for us to move into.

0:23:100:23:13

So the plan is to renovate this cottage and get tenants in.

0:23:130:23:16

As Kent University is nearby, they should have a constant supply of students.

0:23:160:23:21

But how long before they can advertise it for rental?

0:23:210:23:26

I've really got to get on and get the work done because I've got to get an income in...

0:23:260:23:30

to pay for the mortgage. So really, I'm hoping to get it all the works done within a month.

0:23:300:23:35

-A month.

-Yeah.

-Wow. Now that's a tall order.

0:23:350:23:40

Well... you know, because I'm in construction, I've got the people there...

0:23:400:23:45

and the expertise... and the backup.

0:23:450:23:48

That's what it all comes down to.

0:23:480:23:50

Paul's set himself a tight deadline, but the sooner he can get tenants,

0:23:500:23:54

the sooner he can pay off his mortgage.

0:23:540:23:56

Then they can look forward to having it all to themselves... in about three years' time.

0:23:560:24:00

I can picture a little cottage with nice little windows, roses over the door, white picket fence.

0:24:020:24:07

Lovely walking into Canterbury, going shopping, you know...

0:24:070:24:10

into Whitstable to see my family. That would suit me.

0:24:100:24:13

Juliette and Paul made quite an impulsive purchase here, but you can see it is a purchase of passion.

0:24:130:24:20

For Juliette, well, she's dreaming about roses above the door, the lovely white picket fence.

0:24:200:24:26

On the other hand, Paul is thinking about

0:24:260:24:27

getting this done in a month and getting a return on his investment.

0:24:270:24:32

But will he do all that work in just 28 days? You can find out later.

0:24:320:24:37

Coming up, there's a shock in store for the new owners of this house in Gwent. Look what I've found.

0:24:370:24:43

There's a hole here to put my hand through and I can see the house is made of concrete.

0:24:430:24:49

We return to Canterbury, where things haven't been easy.

0:24:490:24:53

I'd be fibbing if I said it wasn't a struggle.

0:24:530:24:57

It has been a struggle.

0:24:570:24:58

But first, it's back to Cornwall, where quantity surveyor Alan has been very busy.

0:24:580:25:03

We've absolutely tried to squeeze as much out of this space as we can.

0:25:030:25:07

Remember this cottage in West Looe, Cornwall, with listed status,

0:25:120:25:16

lapsed planning permission and a dry rot infestation?

0:25:160:25:21

Those were just some of the things that might have put potential investors off.

0:25:210:25:25

Maybe that's why Alan was able to pick it up for just £80,000 at auction, with his first bid.

0:25:250:25:31

However, he had already offered £120,000 a few months earlier.

0:25:310:25:37

It went on at 185, originally.

0:25:370:25:39

-No way.

-Dropped to 165.

0:25:390:25:41

And I offered 120, but they refused it as a repossession.

0:25:410:25:45

Now, that might sound like a result but it's also an indication of how far

0:25:450:25:50

the property market around Looe has fallen.

0:25:500:25:52

And with no idea of how the planning office would view his ideas, not even a quantity surveyor like Alan

0:25:520:25:59

could estimate how long it would take or how much it might cost to renovate.

0:25:590:26:04

Well, it's been a year since I visited, and clearly, a lot has changed in that time.

0:26:060:26:12

The old shop frontage has completely gone.

0:26:120:26:15

In its place are new windows, doors, fresh render and a coat of paint.

0:26:150:26:21

Oh, and that's just the start.

0:26:210:26:23

There isn't really anything that we haven't done.

0:26:230:26:25

All we've kept is actually the original front wall and back wall

0:26:250:26:29

and the substructure, if that's the right term, of the roof itself, actually just the carcassing.

0:26:290:26:34

So everything's been totally renewed.

0:26:340:26:36

Alan kept as much of the original slate from the roof as he possibly could,

0:26:360:26:41

in order to comply with the rules regarding its listed status.

0:26:410:26:45

He's also done a fine job of renewing the cobbles at the front.

0:26:450:26:50

But what about inside? There have been big changes here, too.

0:26:500:26:54

After six months of negotiation between his architect

0:26:540:26:58

and the local conservation officer, Alan managed to get permission to adjust the plans.

0:26:580:27:03

The original planning permission had a slightly different layout.

0:27:030:27:06

We re-jigged it to try and optimise the space.

0:27:060:27:09

Because it is a small cottage, we've absolutely tried to squeeze as much out of this space as we can.

0:27:090:27:14

A good example of that is the kitchen.

0:27:140:27:18

The kitchen we're really pleased with.

0:27:180:27:19

We actually managed to pinch some space in here by actually moving this staircase slightly forward, which

0:27:190:27:24

has created a space where we've actually been able to push the kitchen in this direction.

0:27:240:27:28

We've also used a deeper worktop so actually, you don't end up bumping your head on here.

0:27:280:27:32

And I think it's worked really well.

0:27:320:27:34

We're also really pleased with...

0:27:340:27:36

we've gone for a stone, natural product on the actual splashback.

0:27:360:27:39

And I think that complements the natural slate floor, as well, really well.

0:27:390:27:43

Alan's done a great job here and it's not limited to the ground floor.

0:27:430:27:50

He's used every possible nook and cranny to add extra storage space.

0:27:500:27:55

Cos it is a cottage, it's difficult to get big furniture upstairs,

0:27:550:27:59

so we've got built-in wardrobes in the bedrooms.

0:27:590:28:02

We've got storage on the landing, to make it as practical as possible to live in.

0:28:020:28:06

He moved the bathroom into one of the bedrooms on the first floor.

0:28:060:28:11

My daughter, she comes round to see what I'm up to sometimes,

0:28:110:28:14

so she takes credit for the bathroom being in the position it's in.

0:28:140:28:17

So she was quite pleased with that decision.

0:28:170:28:20

That means there's now a bedroom on the top floor, where the bathroom used to be.

0:28:200:28:26

You've got this little landing area here, as well, which actually is ideal for a little computer station.

0:28:260:28:31

And we're really pleased with this room. It used to have a window that was much higher.

0:28:310:28:35

You couldn't see out and it didn't make the room such a nice place to be.

0:28:350:28:39

The conservation officer was really good and let us make that window much bigger.

0:28:390:28:42

And it's made this room much nicer. So we're really pleased how this one's turned out.

0:28:420:28:47

One thing that Alan wasn't able to do was fit double glazing, because of those planning constraints.

0:28:470:28:52

But he does intend to install a special system to combat condensation.

0:28:520:28:58

All in all, this is a fantastic renovation but none of it's been plain sailing.

0:28:580:29:02

We did have some real problems, mostly because of the rot and damp,

0:29:020:29:05

which has just eaten away and actually destroyed most of the timbers in the floors.

0:29:050:29:10

We had to have a steelwork scheme put together to strengthen the building,

0:29:100:29:14

and replace all the floors internally.

0:29:140:29:16

So it's one of those things that I was hoping I wouldn't have to do.

0:29:160:29:19

It's cost me quite a bit more money to actually do this work,

0:29:190:29:21

but I think we've got a better product at the end.

0:29:210:29:24

With a lack of parking or storage space outside,

0:29:240:29:28

moving materials on and off site has also added to the cost of the job.

0:29:280:29:33

Alan estimates he's spent around £135,000 on the place, including his purchase price and fees.

0:29:330:29:41

He'd like to sell it for £200,000, but with the slump in the market,

0:29:430:29:47

he's keeping his options open and may choose to rent it long-term or as a holiday let.

0:29:470:29:54

What will two local property experts think?

0:29:540:29:56

My first thoughts are -

0:29:560:29:59

obviously, he's done a great job inside...

0:29:590:30:03

but primarily, how he's managed to get

0:30:030:30:06

the shop front gone and a cottage front in...

0:30:060:30:09

amazing, he's done a really good job there.

0:30:090:30:11

Externally, it looks bright and clean and tidy, and you come in, and he's

0:30:110:30:16

obviously spent a lot of time and thought over how he's converted it.

0:30:160:30:21

The fellow could resell it quite happily and I'm

0:30:210:30:22

sure he'd make some money out of it, but it is a very good letting spot.

0:30:220:30:26

Looe is hugely popular.

0:30:260:30:28

This property's an ideal holiday let.

0:30:280:30:31

You've got three bedrooms so therefore you're going to accommodate four people,

0:30:310:30:35

but the living space isn't really big enough for a permanent living home.

0:30:350:30:41

It sounds as though the experts are leaning towards letting the property out.

0:30:410:30:45

But what sort of return could Alan get?

0:30:450:30:47

If you were in a holiday let, then in the height of the summer, you'd be looking at around £600 per week.

0:30:470:30:52

On an ordinary residential letting, you're probably looking at about that sort of money per month.

0:30:520:30:58

£600 per calendar month would provide a yield of around 5.5% on Alan's £135,000 investment.

0:30:580:31:07

I'm hoping to rent it out for about £625, so that's not a million miles apart.

0:31:070:31:11

And on the holiday market, I mean, we run holiday accommodation...

0:31:110:31:15

I'd say that's quite realistic.

0:31:150:31:17

I was hoping a little bit more but around that sort of figure.

0:31:170:31:19

How much could Alan make if he decided to sell?

0:31:190:31:22

Remember, he spent around £135,000 on it, and would really like to get around 200,000.

0:31:220:31:31

If I had to put the property on the market today, I'd pitch it at around £180,000.

0:31:310:31:36

I would recommend an asking price of 185,000.

0:31:360:31:39

That's around a £45,000-£50,000 pre-tax profit.

0:31:390:31:43

But after a year's work, it sounds as though Alan's mind is made up.

0:31:430:31:48

I think I would rent it in the short term, just to wait till the figures get a little bit higher.

0:31:480:31:52

But, you know, quite pleased with that.

0:31:520:31:54

In fact, Alan did decide to rent out the property.

0:31:540:31:58

Just a few days after our filming, he found tenants who are paying him £650 per calendar month.

0:31:580:32:03

So, this is Blackwood and I'm here to see an ex-local authority house.

0:32:130:32:18

Three bedrooms, semi-detached,

0:32:180:32:20

at a guide price of 35,000-41,000 quid, which for around here, seems like pretty good value for money.

0:32:200:32:27

So, let's find out what's wrong with it. Well, for a start, the entrance is quite unusual.

0:32:270:32:31

You have this sort of zig-zaggy slope.

0:32:310:32:33

Now, you may consider this to be a real bonus...

0:32:330:32:36

somebody with walking difficulties, perhaps, or in a wheelchair.

0:32:360:32:39

On the other hand, you could consider it a bit of an eyesore.

0:32:390:32:42

Removal of the wheelchair access could cost quite a bit

0:32:440:32:48

and the slope itself would be rather steep, too.

0:32:480:32:51

However, the house seems to be in reasonable condition with new uPVC glazing always a bonus.

0:32:510:32:59

Okey-dokey. Right into the entrance. Now, this is an ex-local authority house,

0:32:590:33:02

so we're expecting it to be really solidly built. Quite right, too.

0:33:020:33:06

Lots of storage space. That's my experience of these kind of places.

0:33:060:33:08

Got your stairs up to the bedrooms, there. You've got a front sitting room here.

0:33:080:33:11

Then through to the rear of the property where you've got rear lounge, sitting room area.

0:33:110:33:17

I would actually use this as a dining room.

0:33:170:33:20

Nice view out onto the garden. Maybe put some French doors in there.

0:33:200:33:22

And then through to the kitchen. Perfectly serviceable.

0:33:220:33:28

These units are obviously not brand spanking new but if you're renting this place out, they would do.

0:33:280:33:31

You've got your utility room there. You've got a loo. Everything you need.

0:33:310:33:37

Obviously, there is a bit of work needed, mainly restoration and redecoration.

0:33:370:33:42

I'd say the central heating needs to be replaced but there's nothing here

0:33:420:33:46

that's going to surprise the new owner.

0:33:460:33:49

Well, the good news is, the bathroom and loo are upstairs,

0:33:490:33:53

although there is only a shower, a disabled access shower, so no bath.

0:33:530:33:57

You might want to put one of those in.

0:33:570:33:59

Three bedrooms, small box room there. Double bedroom here. And a double bedroom at the back.

0:33:590:34:03

Looks like the paper's coming off the ceiling.

0:34:030:34:06

I'd want to just check that out a little bit more but apart from that,

0:34:060:34:09

you know, it's a solid, good-sized little house.

0:34:090:34:13

Outside, there's a decent-sized garden that just needs some TLC.

0:34:140:34:19

But all the signs point to an ideal family home.

0:34:190:34:22

So, why the low guide price of just 35-41 grand?

0:34:220:34:26

That needs further investigation.

0:34:260:34:28

Now there's something which is worrying me about this house, and it's not that obvious.

0:34:290:34:35

But whenever I see pebbledash like this, I get an alarm going off in my head

0:34:350:34:39

which says "I wonder what this house is constructed of?"

0:34:390:34:42

cos you want to try and avoid houses of non-standard construction.

0:34:420:34:45

You've probably heard me talking about that before.

0:34:450:34:47

If I do a bit of investigation here, look what I've found.

0:34:470:34:51

There's a hole here to put my hand through and I can see that actually, the house is made of concrete.

0:34:510:34:58

So, it is non-standard construction.

0:34:580:35:00

Now that may instil fear into you, and quite rightly so.

0:35:000:35:04

However, the good news is that there are different kinds of non-standard construction.

0:35:040:35:09

And this happens to be something called Wimpey no-fines.

0:35:090:35:13

Thankfully, generally, these kinds of properties,

0:35:130:35:16

with that construction, don't have any problems.

0:35:160:35:18

So, it's mortgageable, and nothing to worry about.

0:35:180:35:23

A no-fines Wimpey home essentially means

0:35:230:35:26

that there's no fine aggregate in the mixture used to build the house.

0:35:260:35:31

So, it really is a solid one.

0:35:310:35:34

But what does a local estate agent make of it?

0:35:340:35:36

This could be quite a nice property.

0:35:370:35:40

Obviously, there are things that need to be done.

0:35:400:35:43

The kitchen needs a little bit more refinement.

0:35:430:35:46

The units are quite nice standard.

0:35:460:35:49

And I would probably do something with the outside

0:35:490:35:51

because it has no kerb appeal, whatsoever, at the moment.

0:35:510:35:55

And basically, if you don't like a house from the outside, then you're not even going to view it.

0:35:550:35:59

Rental income for this sort of area's quite high because it's

0:35:590:36:02

quite near the high street and all the local amenities here.

0:36:020:36:05

So, per calendar month, I would say about £500 per month.

0:36:050:36:09

If someone snapped this up near the guide price of just 35,000-41,000,

0:36:090:36:14

what could it sell for once renovated?

0:36:140:36:17

Once refurbished to a nice standard, it would probably range anything from £85,000-£80,000.

0:36:190:36:27

So, what appears to be a fairly normal house on the outside is, in fact, non-standard construction,

0:36:290:36:36

but thankfully, it's of the type that shouldn't give too many problems

0:36:360:36:39

when it comes to raising a mortgage.

0:36:390:36:41

However, it could still catch out the unwary.

0:36:410:36:44

Let's find out who bought it at the auction and if they were prepared.

0:36:440:36:48

What shall we say on it? Can I see someone near 60? Start me.

0:36:500:36:53

Lot number 260 then.

0:36:530:36:56

Start me. I'm in your hands. Who's got 55 then to get on?

0:36:560:36:59

55.

0:36:590:37:00

50. 50. Thank you, sir, at 50,000.

0:37:000:37:02

That's no money for it. At 52,000, can I? At 50...

0:37:020:37:06

all right. One I'll take. 51 is bid.

0:37:060:37:09

Two is bid. Thank you. At 52,000.

0:37:090:37:11

At 52. Three. Thank you. At 53.

0:37:110:37:14

You're out right in front of me.

0:37:140:37:15

It is your bid, sir. 53. 54.

0:37:150:37:18

Thank you. 54. 55?

0:37:180:37:20

55. 56 on my left here.

0:37:200:37:22

Half, thank you, in the back.

0:37:220:37:24

56,500. Seven, can I say?

0:37:240:37:27

At 57. Make it another half, is bid. Thank you. 57,500. Eight, can I?

0:37:270:37:32

At £58,000. Am I missing you? Half.

0:37:320:37:34

Thank you. Fresh bidder at 58,500.

0:37:340:37:37

Nine seated here. At 59. Half.

0:37:370:37:40

Thank you. At 59,500. 60 bid here.

0:37:400:37:43

Can I take another one there, please?

0:37:430:37:45

Are you coming back in, behind?

0:37:450:37:47

How much... A half. Thank you. 60,500. I thought you'd got it.

0:37:470:37:51

At 61. And another half. 61,500.

0:37:510:37:53

Thank you. 62. 62 I'm bid.

0:37:530:37:56

Do it again, sir. It's 62,000. Is it going to be another one?

0:37:560:37:59

Change your mind if you like. At £62,000. It's yours, sir.

0:37:590:38:03

Thank you very much. Buyer number ten.

0:38:030:38:06

The successful bidders for that semi in Blackwood were local couple, Richard and Eileen.

0:38:060:38:12

I met Richard to hear about their plans and it turned out he's a lot more local than I thought.

0:38:120:38:18

Richard, congratulations. Nice to meet you.

0:38:200:38:22

Why did you want to buy this house?

0:38:220:38:24

I was born about 500 yards away.

0:38:240:38:27

And at the moment, I still live 500 yards away but in a different house.

0:38:270:38:31

-So I do know the area pretty well.

-Pretty well.

-Pretty well.

0:38:310:38:36

You were born 500 yards away and you now live 500 yards away.

0:38:360:38:40

That's right. Yeah. Not in the same house.

0:38:400:38:41

I have moved once or twice, but always in Blackwood.

0:38:410:38:45

When I was young, you know, and you get invited to birthday parties,

0:38:450:38:50

I'm pretty certain this is one of the houses I came to, you know.

0:38:500:38:53

Used to play kiss chase and things like that,

0:38:530:38:56

-round the outside.

-You were playing kiss chase in the garden.

0:38:560:39:00

So it has very happy memories for you then.

0:39:000:39:02

Yeah... bearing in mind, I was probably only four or five at the time, you know.

0:39:020:39:05

And I did grow up slightly and I wasn't quite so tall at the time.

0:39:050:39:10

Fantastic. So, tell me more about you.

0:39:100:39:13

Well, basically, I retired about two and a half years ago.

0:39:130:39:16

I had a specialist builder's merchant's company, about ten miles away.

0:39:160:39:21

And we got to the stage where we thought we've got to start thinking

0:39:210:39:26

about retirement in a few years' time.

0:39:260:39:27

And obviously, we had some money for the business which we invested at the time,

0:39:270:39:34

which over the last year or so, because of the credit crunch,

0:39:340:39:39

we've just seen our income drop by about 80%.

0:39:390:39:42

-80%.

-80%. Yes.

0:39:420:39:45

Good heavens.

0:39:450:39:47

You know, and when we retired we thought, oh, we can live quite comfortably

0:39:470:39:51

on our income from our capital.

0:39:510:39:55

But we thought perhaps it's time now to do something else and look at something else to do.

0:39:550:40:00

Plus, I was starting to get a little bit bored.

0:40:000:40:03

# Golden years, gold... #

0:40:030:40:08

So much for an early retirement.

0:40:080:40:10

Seeing such a drop in their savings, Richard decided enough was enough.

0:40:100:40:14

In order to secure their pension, he and his wife, Eileen,

0:40:140:40:18

invested in a couple of properties which, so far, is going well.

0:40:180:40:23

-What are the plans for it?

-The plans are to strip it out a little bit, see what we come across.

0:40:230:40:30

And then we decide on how much replastering's got to be done and

0:40:300:40:34

how much work's got to be done to the kitchen.

0:40:340:40:36

And if we're going to sell it, then obviously we're going to

0:40:360:40:40

do it to a higher standard than if we're going to let it back out.

0:40:400:40:43

-But you're not quite sure what you're going to do, at this point.

-Not sure, at the moment.

0:40:430:40:46

We've got a couple of other properties we've also bought, which are in stock,

0:40:460:40:52

waiting for us to do something with.

0:40:520:40:53

So we may renovate this one to a higher standard and sell it on.

0:40:530:41:01

-You haven't talked about the front, which obviously was put there for somebody for wheelchair access.

-Yes.

0:41:010:41:07

What are you going to do about that? Are you going to leave it like that so it would be suitable for...?

0:41:070:41:12

At the moment, I think we will because once somebody found out we bought it at auction,

0:41:120:41:17

they came along to me and said, well, look, you know, if you're thinking of letting,

0:41:170:41:22

we wouldn't mind being considered because we're expecting our first child

0:41:220:41:26

and this would be ideal for us cos it's close to our mother, we can get the pram up and down.

0:41:260:41:31

I hadn't thought about using it for a stroller. Yeah.

0:41:310:41:34

But if we find that it does put people off, it's not too much

0:41:340:41:37

of a job to put a machine in, get rid of it and reinstate a garden with a set of steps out the front.

0:41:370:41:44

As the estate agent pointed out, lettings are strong in this area.

0:41:440:41:49

For someone to have approached Richard before he's even started work is encouraging.

0:41:490:41:53

But does the non-standard construction of this property worry him?

0:41:530:41:58

No. Not at all. I've known these houses for many years and during my working life,

0:41:590:42:03

I've worked on many of them, as well. So it's not a problem.

0:42:030:42:07

It's never been a problem with mortgaging them or anything else.

0:42:070:42:11

I did actually just check with my solicitor before we went to auction just to make certain that

0:42:110:42:17

there isn't a problem if we did decide to sell it,

0:42:170:42:20

for people to be able to get a mortgage on it.

0:42:200:42:23

And he said no, there's no problem,

0:42:230:42:25

he's dealt with many, many of these because there's an awful lot of them in this area.

0:42:250:42:28

So how much are you planning to spend doing it up?

0:42:280:42:31

Well, if we're going to let it, we've got a budget of about £5,000.

0:42:310:42:38

But if we're going to do it to a standard for reselling,

0:42:380:42:42

which includes a fair amount of replastering, especially upstairs...

0:42:420:42:47

new electrics... well, I think it could go up to £8,000 or £9,000 then.

0:42:470:42:52

What kind of timescale have you got?

0:42:520:42:54

Well, we're going away in a couple of weeks' time and we're away for a month,

0:42:540:42:59

so we're not really going to get much done before we go away.

0:42:590:43:04

But we'd like to think that when we come back,

0:43:040:43:06

about a month's work on it, cos again, it's just myself and my wife.

0:43:060:43:10

She tells me what to do and I do it.

0:43:100:43:11

In fairness, she's very good, very handy with a paintbrush.

0:43:110:43:16

-And she's not bad on a cement mixer, as well.

-Fantastic.

-Yeah.

-She's a keeper.

0:43:160:43:21

Yes. So we're probably looking at six weeks' work, realistically...

0:43:210:43:28

to get it into a reasonable order.

0:43:280:43:31

Well, listen, congratulations. Good luck and we look forward to seeing how you get on.

0:43:310:43:33

Thank you very much, indeed. Thank you.

0:43:330:43:35

Well, from playing kiss chase in the garden to actually owning the house, Richard has come a long way.

0:43:370:43:45

I am a little bit concerned that he doesn't know what he's going to do with it, though.

0:43:450:43:50

Will he rent it or will he sell it?

0:43:500:43:51

A very important decision cos everything hinges on it when it comes to the renovation.

0:43:510:43:57

You can find out what he decides to do later in the show.

0:43:570:44:00

In the game of property investment, you want to make sure you're holding all the cards.

0:44:020:44:07

But did today's developers get a full house, or did they go bust?

0:44:070:44:12

Time now for them to show us their hands.

0:44:120:44:14

# You look like an angel... #

0:44:190:44:20

When husband and wife Paul and Juliette paid £164,000 for this picturesque cottage

0:44:200:44:26

near Canterbury, in Kent, it was because they fell in love with it, but inside, there was a dark side.

0:44:260:44:32

# You're the devil in disguise

0:44:320:44:35

# Oh, yes, you are Devil in disguise. #

0:44:350:44:39

Subsidence had caused some major internal problems,

0:44:390:44:43

but as Paul was a master builder, they didn't scare him.

0:44:430:44:46

It took just ten weeks to fix and renovate. But it's not been easy.

0:44:460:44:51

# Heaven knows how you lied to me

0:44:510:44:53

# You're not the way you seemed... #

0:44:530:44:56

I'd be fibbing if I said it wasn't a struggle. It has been a struggle.

0:44:560:44:59

But, you know, no pain, no gain.

0:44:590:45:03

You've just got to, you know,

0:45:030:45:05

-buckle down and get on with it.

-The best bit is seeing it all finished...

0:45:050:45:08

really. And also, I'm really pleased with the way it has turned out.

0:45:080:45:12

With the help of his trusted team, Paul has successfully

0:45:130:45:17

exorcised this cottage and all those cracks are just a memory.

0:45:170:45:20

While the couple hope to live here themselves one day, the initial plan was to renovate

0:45:200:45:25

and let it to students for the next couple of years.

0:45:250:45:28

To maximise their return, the dining room's now a bedroom

0:45:280:45:32

and upstairs, Paul has made a few adjustments to the existing bedrooms.

0:45:320:45:35

This was one of the larger bedrooms, but to create a bigger box room, we've put in this petition here...

0:45:350:45:42

and here. So, as you can see, as we come in now to the box room...

0:45:420:45:46

it's a bigger room.

0:45:460:45:48

This was the original wall...

0:45:480:45:50

of the box room. So we've knocked through here

0:45:500:45:53

to give us a room for our wardrobe, desk and chest of drawers.

0:45:530:45:59

And a nice area...

0:45:590:46:01

for the bed.

0:46:010:46:03

This gives us my square footage for student lettings, what they require.

0:46:030:46:08

For a small cottage, there's actually quite a lot of room.

0:46:080:46:12

However, if the four students can't find enough space in the communal lounge,

0:46:120:46:17

or the brand new fitted kitchen, there's plenty of space outside.

0:46:170:46:21

When we first looked at the property, the boundary came

0:46:210:46:25

from over there, just down to that behind them trees there.

0:46:250:46:27

Well, we had to clear it cos it was all overgrown.

0:46:270:46:30

So we got a digger in, levelled it and we found

0:46:300:46:32

that the boundary actually went far-reaching over there.

0:46:320:46:35

So it makes the property a lot bigger here, the garden area.

0:46:350:46:37

So we've levelled it off a bit, we've grass-seeded it.

0:46:370:46:41

And it'll come up green so it's still an added benefit on the property, really.

0:46:410:46:44

Although Paul has been busy on other projects, they've still completed this cottage on schedule.

0:46:440:46:50

That work included underpinning to solve those structural issues, on top of a thorough renovation.

0:46:500:46:55

Did they manage to stick to their original budget?

0:46:550:46:59

I said 17, and you know, it really has cost 17.

0:46:590:47:04

If I had put my own time on top of it, it probably would have come out more,

0:47:040:47:09

but as it's my project, you tend to do a lot of things... you know,

0:47:090:47:13

for nothing... for free.

0:47:130:47:15

That brings the total investment to date to about 181,000.

0:47:150:47:20

Now that it's finished, it's all ready for the first group of students.

0:47:200:47:25

With this our first year of ever renting a house out to students,

0:47:250:47:28

we went to a student letting agency, so they took all the hard work out.

0:47:280:47:31

They found the students for us. And they've got four moving in.

0:47:310:47:35

And they collect the rent but we'd be doing the partial management,

0:47:350:47:39

so we'll still have a good eye on the cottage and any problems that come back to us.

0:47:390:47:43

They paid 165,000 for this property at auction and spent £17,000 on renovation.

0:47:430:47:50

To make it work, they're looking for about £1,200 per calendar month in rent.

0:47:500:47:57

What will two local estate agents think of that?

0:47:570:48:00

First time I've been back to the property

0:48:120:48:14

and they've done a really good job on it.

0:48:140:48:16

It's been done on a budget but it's been done pretty well.

0:48:160:48:19

And they created a good student house.

0:48:190:48:20

This will be good for students - it is detached, it has got parking

0:48:200:48:24

and it is a configuration that can be let to four.

0:48:240:48:28

And there are lots of groups of four looking to rent.

0:48:280:48:33

Arguably, this is a really good student house.

0:48:330:48:35

It's detached. It's got parking. It's a really quaint cottage.

0:48:350:48:38

On the other hand, some of the bedrooms are quite small.

0:48:380:48:40

It's got no ensuite facilities, so I think it's going to be

0:48:400:48:43

much of a muchness for some of the purpose-built student accommodation.

0:48:430:48:47

There is a massive demand for student accommodation in Canterbury.

0:48:470:48:50

There are something like 35,000 students in the population of Canterbury, which is about 40%.

0:48:500:48:56

That will be music to Paul and Juliette's ears, as they'll

0:48:560:49:00

almost certainly be guaranteed tenants for as long as they want.

0:49:000:49:04

What kind of rental do the estate agents think they could get?

0:49:040:49:08

I'd expect a rental for this property in the student market to be

0:49:080:49:10

somewhere around about £300 a room, per month, generating about £1,200 per calendar month.

0:49:100:49:16

I would expect this one to let at about £300 per person, per room.

0:49:160:49:21

£1,200 per calendar month.

0:49:210:49:24

And the students pay for 11 months of the year.

0:49:240:49:25

-Oh, good.

-Yeah.

-Right on the button there.

-Who we went with.

0:49:250:49:30

Yeah. It was obviously the right choice.

0:49:300:49:33

No surprises there then. A good solid rental return.

0:49:330:49:39

But has all the work done here increased the value of this property?

0:49:390:49:43

The guide price for this cottage was £120,000-£130,000.

0:49:430:49:46

They paid a little bit over the odds... 164,000...

0:49:460:49:50

and they spent a reasonable amount on the property, £18,000.

0:49:500:49:53

They've done a good job with that budget and I think they've created quite a good investment.

0:49:530:49:57

It's going to be great for the student market

0:49:570:49:59

and in terms of capital value, you're probably up to £225,000.

0:49:590:50:03

-Yeah.

-That's good. Yeah.

0:50:030:50:05

That's a pleasant surprise. Yeah.

0:50:050:50:07

In conclusion, it's a sound investment, both in rental and long-term value...

0:50:070:50:12

exactly what Paul and Juliette planned all along.

0:50:120:50:16

We're doing this for ourselves, long-term.

0:50:160:50:19

Being self-employed, I haven't got a great pension, so you know, you have got to think about those things.

0:50:190:50:23

It soon comes round.

0:50:230:50:25

And it's been hard work, but you know, no money's easy.

0:50:250:50:31

You've got to work at it, so yeah, it's been a good experience. We'll do it again.

0:50:310:50:36

When Richard and his wife, Eileen, sold their builder's merchant's business

0:50:400:50:44

and settled into early retirement, they thought their working days were behind them.

0:50:440:50:50

But seeing their income drop as much as 80% due to the credit crunch,

0:50:500:50:55

they decided to take action and invest in property.

0:50:550:50:58

One of those was this three-bedroom semi in Blackwood which they bought for £62,000.

0:50:580:51:05

We returned after nearly four months to find out how they'd got on.

0:51:050:51:09

Well, first thing which is happening after three-and-a-half months,

0:51:090:51:12

once we started it, we went away for a month.

0:51:120:51:15

And we left it to a plasterer and in fairness, he did a first-class job of it.

0:51:150:51:23

# We're all going on a summer holiday

0:51:230:51:26

# No more working for a week or two... #

0:51:260:51:29

I like Richard's style of developing, but in fact, this was no holiday.

0:51:290:51:34

On their return, he, his son and wife Eileen did most of the work themselves.

0:51:340:51:40

When we started in here, we realised that the wall wasn't actually the wall, it was hardboard and everything

0:51:400:51:46

was fitted on to hardboard which was falling away from the existing walls.

0:51:460:51:52

So we decided we had to rip it all out and start again.

0:51:520:51:56

And we think it's come out quite well.

0:51:560:51:58

The existing kitchen was not as big as this.

0:51:580:52:01

We, obviously, strayed a bit in to the living area, but to compensate, we put the French

0:52:010:52:07

windows in and generally, yes, we're very pleased with it. We are quite pleased with the way it's come out.

0:52:070:52:11

As well as the new kitchen/diner, the whole property's been renovated to a high standard.

0:52:110:52:18

But it took slightly longer than expected as they were working

0:52:180:52:21

on another three properties they'd bought at the same time.

0:52:210:52:25

So much for early retirement.

0:52:250:52:27

# And I said

0:52:270:52:28

-# Are you ready

-Are you ready

0:52:280:52:31

-# Are you ready

-Are you ready

0:52:310:52:33

# To retire. #

0:52:330:52:35

Yes. It has been hard work and having several houses on the go at the same time

0:52:350:52:40

has meant I'm working seven days a week now which is coming up to retirement with a vengeance.

0:52:400:52:47

But, yes, I've enjoyed it. It gives me a purpose of getting up in the morning. The highlight of the day,

0:52:470:52:52

a few months ago used to be walking my grandchildren down to school and picking them up in the afternoon.

0:52:520:52:58

And I still like doing that. But I've certainly

0:52:580:53:01

enjoyed being more hands-on than I have been for a couple of years.

0:53:010:53:05

At the back of the house, Richard's wife, Eileen, has been busy with the garden and it's looking good.

0:53:050:53:11

Overall, the renovation is a big improvement, but it must have cost a lot more than originally budgeted.

0:53:110:53:17

We didn't pay a huge amount for the property to begin with.

0:53:190:53:23

We put £11,000 into the property.

0:53:230:53:26

And I'm still quite happy with what we've spent on it.

0:53:260:53:31

When we first met, Richard hadn't decided whether to let this property or sell it.

0:53:310:53:36

After investing a total of £73,000 buying and renovating, what's he decided to do with it?

0:53:360:53:43

By putting the quality into the property as we were renovating it,

0:53:430:53:48

in five years' time, that quality will still be there if we do decide to sell it.

0:53:480:53:52

So we're going to rent it and actually we have a tenant for it.

0:53:520:53:56

Richard paid just £62,000 for the property at auction and spent £11,000 on renovations.

0:53:560:54:03

What will two local estate agents think of this property and its potential returns?

0:54:030:54:08

I think this property has been renovated to a very high standard.

0:54:200:54:24

The colours are neutral and will appeal to the majority of people,

0:54:240:54:29

both in the rental market and for the sales market, also.

0:54:290:54:33

I think the renovation is done to a very, very high standard.

0:54:330:54:38

It's almost like a different house.

0:54:380:54:40

The only downsides, I would say, at the moment, the bathroom, the way it is, won't appeal to everybody...

0:54:400:54:47

and the front of the property is a bit of a different situation, as well.

0:54:470:54:52

Hopefully, the tenant that Richard has lined up

0:54:520:54:56

won't mind not having a bath, but that may depend on how much the rent is.

0:54:560:55:01

For rental, I would expect this property to achieve anywhere between £475 and £500 per calendar month.

0:55:010:55:08

Rental assessment on this property, I would say £500 per calendar month.

0:55:080:55:12

Well, pretty much on the money there because we're actually letting it

0:55:120:55:16

£495 per calendar month, so I think they were pretty close.

0:55:160:55:22

With a tenant ready to move in, Richard is happy to let for a while.

0:55:220:55:26

As he's invested a total of £73,000 buying and renovating this property,

0:55:260:55:31

he needs to know what it might be worth in the current market.

0:55:310:55:35

I'd put it on the market at £110,000, to look to achieve 105.

0:55:350:55:40

-I would market the property between £110,000 and £115,000.

-I've got no problem with that.

0:55:400:55:46

I would have been happy if it was in the 95 mark and anything over the 100, quite happy with it.

0:55:460:55:54

Based on those figures, Richard would make a pre-tax profit of

0:55:540:55:58

around £30,000-£35,000 if he decided to sell.

0:55:580:56:02

That would go a long way to helping him retire properly.

0:56:020:56:04

# I want to retire

0:56:040:56:07

# No longer required

0:56:070:56:10

# I want to get by without the man on my back... #

0:56:100:56:13

Am I tempted to sell?

0:56:130:56:15

No. I think the lady who's going to rent the house tomorrow would

0:56:150:56:18

strangle me if the day before she's due to move in, I change my mind. No.

0:56:180:56:24

We're quite happy to long-term rent, nice tenants.

0:56:240:56:28

Nice tenants coming in to a nice area, nice neighbours.

0:56:280:56:32

I've got no problem with it.

0:56:320:56:34

But the house will be a nice house for many years to come.

0:56:340:56:36

With another two properties already on the go, it seems that Richard

0:56:360:56:41

is quite content not to retire for at least another few months.

0:56:410:56:45

So, lessons have been learned and some money has been made.

0:56:500:56:54

So tune in again for some more Homes Under The Hammer.

0:56:540:56:57

-We'll see you then.

-Goodbye.

0:56:570:56:59

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0:57:070:57:11

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