Episode 19 Homes Under the Hammer

It's more important than ever to buy

-at the right price and in the right location.

-Yes.

From two up, two down, terraces,

to the more unusual and quirky, you can find it all at the auction.

And, of course, with so much choice the key is to not get too carried

away when you buy your home under the hammer.

Buying at auction can be a quick way to purchase property.

But it's very much a case of buyer beware because when the hammer goes down you

have exchanged contracts, you can't just change your mind, and you have to come up with the cash pronto.

So will today's properties be investors' dreams or complete nightmares?

Let's find out.

This mid-terrace house in Derby is crammed with original features and space.

Here you've got the makings of the most wonderful house.

In Kent, this chalet bungalow looks a great buy

but the concrete plot out the back is where the real money is.

We've got ourselves some serious potential.

And I find a quirky property in Southampton, but there's just one quirk too many.

Oh, boy oh, boy, what's that?

All these properties have been sold at auction

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

Sold.

Today I'm just outside Derby city centre in a place called Five Lamps.

The Five Lamps junction is in a historic residential area

and I'm hoping it's going to throw some light, ha ha, on our property.

Well, a short walk from the city centre is the property

I'm here to see, and it sounds very interesting indeed.

It's a Victorian mid-terrace, it had a guide price of £90,000, which for a four-bedroom house like this is

really good going, and this is one where deceptive is a word that springs to mind...

and I'll show you why.

From the front it doesn't look too big, does it?

But you come inside and oh, boy, what a pleasant surprise it is.

nice hallway there, big front room there which is good to see,

stairs up to your bedrooms, then continuing down this corridor you've

got stairs down to the cellar but I'm just wondering if we've got any treats in store under the carpet.

Oh, wow, look at that.

It's called a Minton floor.

Imagine that cleaned up and how fantastic that would be stretching down the hallway,

The property continues going back.

You've got a sort of rear sitting room there and then through into this massive kitchen.

Now, it's a bit, you know, well, horrible really, but put a really nice

kitchen in here and you've got the makings of a most wonderful house.

Also on the ground floor, behind the kitchen, is a downstairs bathroom

that could easily be converted into a utility area.

Well, up here you've got a bathroom and a loo and a bedroom that way, a large double bedroom there.

It just sums it up really, the space in this house is fantastic.

The landing feels lovely and open, helped by these extremely high ceilings.

Box room there, large double bedroom there, and I think if you wanted to extend the house even more you could

because I know that there is room in the attic to potentially build even more rooms.

I mean it is just a fantastic house.

This truly is a gem of a property and it's not just the space that is selling it,

it's that solid Victorian construction that's a perennial favourite of buyers everywhere.

So, big bedrooms, I mean, I love it.

Nice big windows, lots of light coming in, features, fireplace, just great, get that stripped back.

But you haven't seen the best thing yet.

How about that for a wall of wallpaper?

It's blooming marvellous.

And on the subject of flowers, out back there's a good-size garden that wouldn't really take long to tame.

To get an idea of what the property might be worth

I invited along the auctioneer that sold it to hear his opinion.

It's a lovely house. Super.

Exactly what you'd want from

an old terraced house, it's still got some of its character in it.

Nice feel to it, nice appeal, I like it.

If you want to make it a very nice house, beyond what it is now, then you finish up spending 20,000 on it.

So, let's talk figures. How much could someone make here?

Once renovated, and assuming a reasonably good standard,

I think on today's market it would probably have a ceiling value of about £150,000 to £155,000.

On a single family let I would say you're rental income would be about £550 to £575 a calendar month.

Well, it's a lot of house for that £90,000 guide price.

It would make a lovely family home or a perfect rental machine.

Lots of options. Let's see who went for it at the auction.

Lot 78. How much can I say for this one? Start me where you like. 90?

Put it in. 90 I have, thank you. At £90,000 opening bid.

95, 95, 100, 105.

105, 106? 105 and a half.

106? 106. 107 and a half, 108 is bid.

108,500.

109. 109,500. 111. No?

£111,000. 500 somewhere else?

At £111,000, 500, 12, 114.

114,500. 115.

115,500. 116.

116,500. 120? 120, 120 and a half,

21, and a half, 22,

and a half, 23,

123 and a half, 124.

124,000. 500, sir?

500, £125,000.

No? £125,000 then. 25 and a half.

26, and a half, 27, 127 and a half,

128, 128 five, 129, 129 five, 130.

130,000 against you. No?

130,000 then, once, twice, third time.

Sold at 130. Thank you.

After all that to-ing and fro-ing the property was eventually bought

for £130,000 by Tom, a local businessman.

He paid a hefty £40,000 over the guide price to get it.

-Tom, lovely to meet you.

-You too.

-Good house.

-Thank you.

So tell me why you wanted to buy it.

Well, to be honest with you, I had a bit of spare money knocking about and the bank interest

rates are pretty rubbish so I thought the best thing was put it in property.

have you had any experience of property?

Well, I bought a house with my brother about two years ago and I rent out rooms there as well.

That kind of went pretty smoothly so I thought I might as well buy another.

What do you do?

I run a recruitment business.

-Oh.

-In Derby. We specialise in construction so I thought the two might

marry quite nicely as well because I know the local tradesmen who can do the work.

For any would-be developer connections are all-important.

# Make sure you're connected, the writing's on the wall... #

What was it about this particular house...?

Well, I've always grown up in Victorian period properties

and they've got a special place in my heart really. It caught my eye when I came round.

-It was more of a personal thing?

-Yeah, absolutely.

Although I work in the construction industry, new build houses aren't my cup of tea at all, so I'm actually

-drawn towards this kind of property.

-So what's the plan for it?

Well, to be honest with you, I haven't really got any 100% plans.

I've got a builder teed up who's going to come in and renovate the property,

and then I'll either rent it out or potentially even more in myself.

Oh, OK. That widens the variety of potential.

Yeah, exactly, yeah.

Yeah, so we'll see how it goes.

# I just don't know what to do with myself. #

Tom, the man without a plan.

But all the same he has clear ideas about what needs to be done to reap the full potential here.

I think all the horrible wallpaper has to come off,

obviously all the nasty carpets are coming up, we'll expose the tiles in the hallway.

Neutral colours, new kitchen, fitted diner in there.

This will become the living room

and we'll have a wet room and just renovate the place.

And outside, are there any plans for that?

It's all right out there really.

They've got a few bushes on the go, they've got an

apple tree coming over the fence, so not a lot to do I think.

Tom's aiming at a six-to-ten-week renovation, and using his

connections in the building trade hopes to do it all on a £10,000 budget.

-So what next for you?

-I think for the time being just concentrate on this.

In an ideal world I'd perhaps like to buy you know a house every year or two, build up a bit of portfolio,

but I'm in no major rush, my first priority's to the business,

and this is an accumulation of nest eggs.

Good, well, congratulations.

Thank you very much.

-And we'll either see you or your tenants when we come back!

-That's right, yeah.

Well, Tom's certainly got the contacts to sort this place out but

it strikes me that he doesn't quite know what he's going to do yet.

He doesn't know if he's going to live in it, rent it out,

how much he's going to spend, or his time scale.

You can find out what on earth happens later on in the show.

Just outside Maidstone in Kent is the village of Larkfield,

once an important village due to its courthouse and administrative role in county affairs.

Now it's popular with commuters.

Larkfield really grew in the 1970s when the M20 was built right next door, running

from London down to Dover. But the motorway doesn't seem to have diverted much traffic away though.

It's still busy and very loud, which is worth

bearing in mind because this is the property I'm here to see.

It's a chalet bungalow and it's got a guide of 140,000 to 150,000.

As it's so near the road and has a front garden that's seen better days it's not exactly oozing curb appeal.

Let's hope it's better inside.

This corridor goes on for days, and there's just a succession of rooms.

You've got a reception room, another reception room, a bedroom, another

reception room, a bathroom, a toilet and another bedroom.

I think it's fair to say this place is fairly huge.

It's certainly that, with two reception rooms, either of

which could be turned into a dining room or perhaps another bedroom.

Then there are two decent-size bedrooms plus a separate toilet and bathroom.

So it's not short of rooms but the layout is rather poor.

Clearly there is no need for all these individual rooms.

As an example, the only function this room serves is to house this staircase.

Now, the kitchen through here is too small, I would definitely take down

this wall and open up this space, and that is just for starters.

Several of these rooms down here would benefit from being reorganised.

So, come on, let's take down these walls, end the separation and really open this place up.

# Take down these walls... #

It feels a bit more like a hotel corridor than a bungalow.

There should be numbers on each door, room 301, 302, it just needs a complete rethink down here.

# Take down these walls... #

I can't help feeling that the upstairs floor with its two

bedrooms isn't utilising the space as well it could either.

But if you think there's scope to improve inside, well, wait until you get outside.

So, traditional bungalow, lots of rooms, nothing crazy about that, and outside you'll be expecting

maybe a lawn, a patio, some dahlias perhaps.

Well, what you get is this, more concrete than cultivation.

Talk about a concrete jungle, this feels more like a piece of wasteland than a garden.

Or should that be land going to waste?

With those old garages at the bottom I see development opportunities.

The easiest thing to do here would be to apply for planning permission for some more garages,

but with most houses having their own off-road parking I'm not sure that's going to make you a mint.

So what about another property?

There's clearly room and as it's a corner plot

you have a second access point and that is the key.

If you were to build another bungalow it wouldn't overlook any

neighbouring properties and there's plenty of demand in the area.

So there you have it, we've got ourselves some serious potential. How exciting.

# Hey now, they pave paradise to put up a parking lot... #

OK, so it's far from paradise and I'd say a parking lot is not the

best option here, but boy does this look like a developer's paradise.

A flat area of brownfield land with road access plus the bonus of the bungalow as well.

But it is still a gamble. What does the local estate agent think?

In my opinion, best suited on this plot would be another dwelling,

potentially a bungalow.

Alternatively, I think a block of flats would be a good idea.

I do not believe that semi-detached properties would be of benefit at all.

Interesting.

I hadn't thought about flats. Which option would maximize the return?

To build a two-bedroom bungalow on the plot, I would estimate the property to be worth around £175,000.

If you got planning on the plot for flats I would imagine that you would

have an estimate price of between £100,000 and £120,000.

If you got five flats, even with build costs, that could bring in a substantial return.

On top of that there's a potential profit with the existing bungalow.

How much would that be worth once done up?

You would probably look to achieve in and around about £250,000.

When you consider both the land and bungalow were guided at just 140,000 to 150,000, then the bungalow alone

could cover your costs, leaving any development at the back as clear profit.

Well, this bungalow doesn't only hide a wealth of rooms, it also holds a potentially

valuable opportunity to build a whole separate property and I think that is where the real money lies.

Let's see who agreed at the auction.

Over to lot 50 which is a detached chalet bungalow there

on a good corner plot.

Potential there for development there as well, subject to planning.

Start me where you will. £140,000.

I'm on the way at 140. 140.

£140,000, I'm on my way at 140.

140 now. 145, at 145, at 145.

150. At 150. 50 it's with you.

And 160 now make it.

160, it's worth it, 160.

160, standing in a fresh place.

170, now make it. 70 I've got, and now £180,000.

180 I've got.

And 190, 190, 190. 190 I've got.

191, 192, 192 and 193,

193, 193.

Keep with it, 193. 193, yeah, he says yes. 194.

At £193,000 you've got, then 94 I'm looking for.

Are we all done at £193,000?

If so, for the first time at 193,000, second time at 193,

third and final time. If you're all done it's going to be sold for 193,000.

Well done, Sir, it's yours for 193 and that's upside down...

For 193,000, about 40 to 50 above the guide price, the new owners of

the bungalow and land are old friends and locals, Mark and Pete.

They hope this might be the start of a property sideline.

-Guys, congratulations.

-Thank you.

-I bet you're thrilled you got this on auction day.

-Yeah.

-Absolutely.

-So who saw the potential in this?

I did, many, many years ago.

I had a girlfriend not living too far away

and used to drive around, and you could see,

-and it just screamed building plot out the back.

-Mark, what do you do?

I'm a bricklaying contractor by trade,

so I've got lots of blokes work for me.

But I've been in the building industry most of my life,

so I feel fairly confident.

You know, we work for some fairly idiot people and if they can do it,

then I'm sure me and Pete have a fair crack at it, you know?

-Pete, what do you do?

-I'm an architect, I sit on the other side of the fence.

I'm the person that Mark would be swearing about on site...

-and running down, but...

-And still will be.

For some time now, these two mates have considered working together and pooling their complimentary skills.

Finally, they've found a project that's right for both of them.

So, Pete, what is it you're going to do to this property to change it?

Essentially, modernise it without it being over-contemporary.

It clearly needs a bathroom, it clearly needs a kitchen.

If we can get a bathroom upstairs as well,

then that will also, you know, be a very positive factor.

Perhaps we'll put in large glass French doors off from the kitchen,

so the place is less focused

on the front of the house where the noisy road is

and more at the back where the garden is.

And that's where your expertise lies.

-Hopefully, we'll find out.

-Yeah.

So what's the budget for the work in here, just in this bungalow?

We hope about 30,000, so...

And it's quite a tight budget and we've bought this, primarily,

-knowing there's no profit in it.

-Mmm.

The profit's in the back garden where hopefully we'll get planning

and that's where we'll make our money.

This seems to be a win-win situation for Mark and Pete.

They've got the combined skills to modernise the bungalow and maybe make a profit here.

But their skills will be tested by the plot at the back.

The plan is... We're still exploring possibles with local agents

to find out what permutation would yield the best results.

What we're looking at is a chalet bungalow,

which the agents were talking about in terms of 200...

-200-210, but they all seem to be screaming flats.

-Had you not thought of that?

We considered it, but we did some initial research with agents,

actually before we went to auction, on it.

And what we'd concluded, rightly or wrongly, was that a chalet bungalow was the right thing to build.

However, yeah, it has thrown a slight curve ball

as now the agents have, sort of, flagged up that, you know,

potentially, flats would be a better route to go.

Well, certainly small, sort of, starter-end of the market.

Tower block it is.

# The only way is up, baby... #

Joking aside, we aren't talking tower block.

More like a two-storey house with, maybe, six apartments.

It would cost more to build, but could bring in more money, so more profit for them.

If they couldn't build, would that scupper their business plans together?

The longer-term goal, if we're honest, this size,

the nature of this, is not where we see ourselves.

In my work, I tend to design a lot of high-end residentials

for wealthy clients who have lovely houses

and have budgets which reflect that.

I think longer term that's where we'd like to be,

-but this is an acorn...

-Yeah, got to start somewhere, don't you?

And, hopefully, our intention isn't really to take the money

and go and buy a fancy sports car or anything.

-Buy the sports car in a few year's time.

-Hopefully.

Well, they say the beginning of any race or journey is all-important.

With Pete and Mark all revved up and raring to go, let's hope the planners give them the green light.

So Pete and Mark are at the start of a beautiful business relationship,

or are they?

What if they don't get their tower block?

What if the planners say a big "no"?

Will they get the money they want for this place?

Will their friendship survive?

You can find out later on in the show.

'Coming up, in Southampton,

'this bungalow may only have one floor,

'but even that's looking dodgy.'

Clearly, have this whole place treated.

We return to Kent to see if working with a mate makes things any easier.

A few times he's like, "Why don't we do this?"

And I'm like, "No, why don't we do this?"

But first, sometimes you CAN just get carried away.

To be honest, I don't know how much has been spent.

We're back at Five Lamps in Derby

where local businessman, Tom, bought this mid-terrace,

four-bedroom house for £130,000.

Despite paying £40,000 over the guide price,

he wasn't quite sure what he wanted to do with it.

So, what's the plan?

Well, to be honest with you, I haven't got any 100% plans.

I'll either rent it out or, potentially, even move in myself.

It's been five months and though the winter weather's a bit chilly,

let's hope Tom's renovation is something we'll warm to.

Tom's restoration programme certainly shows decisive action here -

the dividing wall's been removed and there's an open-plan area leading through to a new kitchen.

So when we first bought the house, there was a wall here,

which we knocked through,

which creates a much more open-plan space here.

We had a doorway in here, which we thought we may as well get rid of

and it just really lends to a continuity right the way through.

Obviously, it's opened up into a big kitchen which we're pleased with.

The nature of the shape and size of the room

meant we were restricted with how to lay out the units,

but we'd just gone for straight down either side,

obviously, with the Belfast sink and the granite worktops.

Really pleased with the ground floor area.

It's open-plan and it means you can communicate with people regardless of what room they're in.

Upstairs hasn't undergone such a radical transformation.

All the bedrooms have been redecorated though, and painted in cool tomes.

The old fashioned bathroom has been modernised, turning it into a luxurious space.

It's pretty clear now that Tom has made a decision about who's going to live here.

Shortly after buying it there was a fair degree of indecision

about what to do with it, whether to rent it out or to move in myself.

I decided to move in myself,

purely because I fell in love with the property

after a little while of doing it up and that's how I find myself here.

Tom's made every effort to restore this house to its former glory.

We replaced all the picture rails, all the coving,

I put new ceiling roses upstairs and down.

And we really just tried to get all the original door knobs,

just restore everything as much as we could to its former glory.

That included the original floor tiles in the hall,

which adds a touch of Victorian class to the entrance.

But on the more practical level, Tom started from scratch

by re-plastering, re-wiring and re-plumbing the whole house,

a process not without setbacks.

The floor was a big thing -

we had to replace a couple of floor joists,

we had to treat for rising damp with injections and damp-proof slurry,

and then, obviously, plaster over the top and get it decorated.

But it was... You know, it was a fairly big job.

With the project now complete after five months, Tom's happily settled in with his two cats.

Even they must be aware of the restoration.

# What's new pussycat?

# Whoa-oh whoa-oh whoa oh-oh

# What's new pussycat?

# Whoa-oh whoa-oh whoa oh-oh... #

I think I'm most pleased with the bathroom.

It is relatively small, but the finish is fantastic -

we had a great tiler who came in and did some really good work there.

Equally, downstairs, I think has turned out really, really well.

Tom has achieved an impressive renovation,

but even with his connections, I wonder if his original budget was washed down the plug hole.

When we put the £10,000 budget together,

that was with a view to renting the property out.

I haven't got, to be honest with you, I don't know exactly how much

has been spent on it, but it was probably more like 40 or 50.

A bit of an overspend there, then.

When developing, it's important not to get too deeply involved in a property,

if you spend too much you may lose the shirt off your back.

But in Tom's case, his new home is his passion.

So, will this love affair last?

I'm happy living here for the time being.

Obviously things change, but for now, you know,

I like being here and I don't have any plans to sell.

I'm not surprised, but with the renovation costs at £50,000

added to his purchase price of 130,000,

Tom's total spend is around £180,000.

Time for two local estate agents

to give their verdict on the restoration.

First impressions are fantastic, totally bowled over,

it's a magnificent house.

You know, the finish and the neutral tones,

the nice pastels that he's picked are really nice.

First impressions - the owner's done an excellent job

of combining the original fabric with the finish that works.

By making the ground floor more open-plan, it's got a more contemporary feel to it.

I think this property will sell well, it's got the wow factor.

As soon as you walk in, you fall in love with it.

Has that "wow factor" come at a price?

Remember, Tom spent around £180,000.

What sort of resale figure could he achieve?

In terms of value,

I think the owner's done everything he can to maximize the resale,

but it's unlikely to return above the £200,000 mark.

If we were to put this property on the market, I would start asking £220,000.

I'm happy with either but, as you know,

I'm not here to sell it anywhere, so it doesn't have a massive impact.

Quite a difference in estimates there,

but even if Tom got the lower value,

he could still make £20,000 pre-tax profit. What about rental?

Looking at the rental market, this should let very well at £700 per calendar month.

If we put this property up for rent,

you'd be able to get £700 per calendar month.

Well, if I ever did want to move to a different house, you know,

I'd rather keep hold of houses rather than sell them, so that's interesting to know.

Those sort of returns could give Tom just under a 5% yield.

But for now, he's focusing on enjoying his new home

and hasn't let that big spend overshadow the experience.

Yeah, I've really enjoyed myself. It's been a lot of hard work,

but I would certainly consider doing it in the future.

Well, there's one investment strategy,

which says you should buy property within close proximity of water.

Well, that works for the property I'm here to see

because it's just three miles away from the marina here in Southampton.

Today's property is in Bitterne village.

It's a popular residential area with good schools, shops,

and easy access into the centre of Southampton

with its bars and entertainment area around the harbour.

Well, although the location ticks the boxes,

the kind of property isn't really in most investors' top-five choices,

because it's a bungalow.

Now I personally love bungalows, I was born in one.

They were brought over from India in the 1920s,

the first ones appeared in London and they spread across the country.

Nowadays, developers don't like them

because they don't make the most of the space they sit on.

However, ones like this... You've got to say, it's got character.

The bungalow was guided at £140,000 and certainly looks inviting

with its fairytale turret and red-and-black chequered brickwork,

which has obviously seen better days.

The bow front seems to have had some movement,

but this just seems to add to the unusual charm of the place.

OK, I wonder if the internal layout is as quirky as the outside.

Well, on the face of it, no, it all seems to make sense.

We've got rear sitting room or dining room leading to kitchen, two bedrooms,

bathroom and toilet, and then through

into the front sitting room, the living room area, I suppose.

But... Oh, boy! What's that?!

HE LAUGHS

Now, no prizes here for guessing what...

Oh, my goodness gracious.

THAT is a perfect, perfect example of woodworm.

You can see the holes, but by the time it gets to this stage,

the beetles, which were burrowing their way through the wood have left, leaving powdered wood.

Now you don't know how far that goes, but...

..that could be quite serious.

Clearly, have this whole place treated

and there's going to be a lot of floorboards that need replacing.

So, not a good start.

Up in the loft, someone has gone to the trouble

of attempting an attic conversion,

but they shouldn't have bothered - it's dark, dingy and cramped.

But at least the potential's there.

Well, not a bad-size bedroom, and lots of light pouring in,

but if you're nervous or suspicious about walking under ladders,

this really isn't ideal -

the stairs up to that bodged job of an attic conversion.

But through here to, I guess, the rear sitting room,

a nice old fireplace, which you could probably have some fun with,

but some odd doorways out to various other parts of the property.

And then through to the biggest problem

with this particular bungalow, which is the kitchen.

I think it's in a bit of an extension,

not a particularly nice job. It's clearly totally lacking.

I'd think about maybe extending the bungalow out

because you need to get a better working area in this place

and I don't see how you could do it with the space there is.

Outside there is some of that space available,

so that's a pretty good option.

At the bottom of the untidy garden there's a timber garage that just might need replacing.

But despite its rundown, dishevelled appearance, this bungalow does have character and individuality.

All it needs is some careful attention to make it a lovely home.

So at a guide price of £140,000,

what does a local estate agent make

of this little two-bed in Southampton?

First impressions of this property -

unusual bungalow, very attractive from the outside.

Obviously, you notice it needs a fair bit of work doing to it.

There are numerous rooms, all of which are quite small,

so it might lend itself to being opened out, extended really.

Once this bungalow was renovated and enlarged,

what market could it be aimed at?

I think, possibly, your target buyer is somebody that's downsizing,

particularly the older generation,

even though the types of buyer have changed over the years.

But you do get quite a vast demand for them depending on time of year.

Given its guide price of 140 grand, would an extensive renovation be worthwhile?

The resale value for this property extended,

you're probably looking in excess of £200,000.

If they did a really good job they might be able to touch on around £225,000.

And the rental returns?

Rental valuation for this property per calendar month is around £800.

Well, it's not without its problems, but you know what?

I really like this little bungalow.

Yes, you'd have to sort out that bowing in the front wall and treat it for woodworm,

but get the planning permission for the extension of the kitchen,

and you've got a lovely little home here.

Let's find out who fell in love with it at the auction.

Lot number eight,

£125,000 is the asking start-point.

125, gentleman in the blue jumper, thank you. 125, I have got.

Is there £126,000 in the room?

There is. Thank you, madam, 126.

Now back at 127, sir.

There's a nod at 127.

Now looking for 128.

128 is bid.

129, thank you. Now looking for 130.

Shake of the head.

I have 129 on my right-hand side,

now looking for 130 from somewhere else.

130, the lady does, chatting to her husband, 130. 131?

131 is bid. 132?

132,000. Sir, 133?

133 he does.

Back to you, madam, 134,000. 135?

134,500? No? Shaking his head. It's with you, madam, at £134,000.

New bidder, thank you, at the back.

134,500.

135, madam?

135,000. Last chance to you, sir, if not, I'm selling.

£135,000, then.

Once, 135 twice...

135,000 for the third and the final time.

Well done.

The successful bidders were Julie and her partner Tor.

They got the bungalow for 135,000, 5,000 below its guide price which was pretty good going.

Julie's a former education and charity-sector worker who now trades on the Norwegian stock exchange.

I met up with her to find out about their plans.

-Julie, congratulations.

-Thank you.

You've got a sweet little bungalow, haven't you?

-It is a sweet little bungalow.

-Why did you want to buy it?

We liked the look of it and we hadn't seen it before we bought it,

but we like the look of it. We...

How do you mean? You haven't seen it...

I know that's breaking the rules, but we... We did it.

We won't do it a second time, but we liked the look of it and it was going at a good price

and we knew the area it was in, so we decided that we would buy it.

The look of it from what? From the picture in the catalogue?

From the catalogue, that's all we knew at the time.

And luckily, very luckily, it's actually a good buy.

So, at what point did you decide you were going to buy it?

-During the auction.

-Actually during the auction?

Yes, yes.

We had been looking at another property, which came on later,

but when this one came up

and we realised the price, we thought it was a good buy.

So, did you read the legal pack?

Nope.

So you not only didn't visit, but you didn't know anything about its legal status.

This is breaking all of the rules and I know it's not what you should do,

and it's not we will do a second time, but this time we did, yeah.

Why?

I think we just...got carried away on the enthusiasm of the day,

and we did like the look of it and we did know the area,

so there were some positives in there.

And we knew the price range of the area.

But we know that by doing that, we put ourselves in line

for some really unpleasant surprises, which luckily haven't materialised.

We, sort of... We've got what we expected with it, so that's OK.

# This could be my lucky day... #

Breaking all those auction-buying rules and getting away with it.

While she and her Norwegian partner, Tor,

may have got lucky with their impromptu buying strategy,

they do at least have a plan for their next step.

We have a plan over four or five years to do several houses,

to sell them on and then, actually to arrive at a point

where we will have the house that we want to stay in.

And that might take a little bit longer

if the market freezes for a while, but it's still the same plan.

But for the present their immediate plan

is to renovate the entire bungalow. Including - new windows, electrics,

plumbing and kitchen.

And the bathroom.

By extending into the garden,

they hope to enlarge the bungalow's footprint

from 65 to 100 square metres.

This would allow them to reconfigure the layout of the rear

and put a proper staircase up to that loft room.

All good news so far until...

We will need to take out the front bay window,

the circular bay window, because that's bulging, rebuild that.

Very probably, I think, take that opportunity to change the turret and have a conventional roof.

That's still in the pot, but we think probably that will go.

Don't get rid of the turret.

Everybody loves the turret, but it's whether anybody would buy the house with the turret.

You bought it from the picture.

-True.

-And the turret was part of the picture.

We'll wait and see.

I may have got a reprieve for the turret here,

but it looks like Julie has taken a practical approach to solve the problems.

The pair have a budget of 50 grand, which seems reasonably healthy,

but there is one big issue to be resolved, the woodworm.

What are you going to do about them?

Strip out the floorboards, replace them, have the joists checked carefully.

If the joists are damaged too, then sadly, they would have to come out.

We're hoping that that's not the case, and the first opinion

from our structural person is that that isn't the case,

but we don't have a definite on that yet.

We've got a little bit of subsidence going on up there too.

Have you had a structural survey done now?

Yes. It's settlement rather than subsidence, and we are on clay here,

and a bungalow built in 1931 would have quite shallow foundations.

It's not collapsed drains, which is good news.

We are taking off this back part of the house anyway,

so we'll be able to treble check that.

We will have to, obviously,

build that back of the house on stronger foundations

and possibly underpin the door, the front door,

put blocks under there to underpin it.

And that, we hope, will actually solve the problem.

Well, perhaps all of that 50 grand budget will be needed.

They plan to do the work themselves and aim to finish in six months,

though something tells me that could be rather tight.

We'll go for lots of natural light, opening it out, lots of light colours, making it comfortable,

clean, Scandinavian, you know, nice design which will be attractive.

-Well, good luck with it and look after it, it's a lovely place.

-Thank you.

So, Julie breaking all the rules buying this place -

not only not visiting it, but also not reading the legal pack.

However, she might have got away with it,

she's got herself a lovely bungalow.

Some ambitious plans, I just hope the turret stays.

Find out how she gets on later in the show.

Time has passed, have our buyers kept to their schedule or have they overrun?

Have the stuck to their budget or has money just slipped through their fingers?

Ha-huh! It's time to find out.

It was just outside Maidstone, Kent, in the village of Larkfield,

where we first met architect, Pete, and his builder mate, Mark.

For their first business venture together,

they'd just bought a rather dilapidated bungalow for £193,000.

It also had the bonus of a potential building plot behind it.

-We bought this, primarily, knowing there was no profit in it.

-Mmm.

The profit's in the back garden, where, hopefully,

we'll get planning and that's where we'll make money.

In essence, this was a two-stage project.

The first stage meant doing up the bungalow

while trying to get planning permission to develop the plot at the back.

Seven months on, where have they got to?

Well, there's definitely been massive progress on the bungalow

with a dormer extension added in the roof,

new windows, doors and a lawned front garden.

And inside? Well, the rooms have been modernised

and the new decor creates a less boxy feel.

And they've opened up some areas, most noticeably in the kitchen.

Well, I don't know if you remember when you was here last time, there was actually a wall here.

We decided to take it down to open it up into a family room

or a kitchen/diner, and one of the subtle, little differences

that no-one really notices

is we actually moved the door over, for two reasons -

one, you're having a breakfast bar, so it makes a definite image,

but also to give you room for a sofa.

The addition of patio doors now means you can go straight out

into the small, but adequate, fenced garden.

The two bedrooms are finished off

and central heating has been installed.

So, with a fabulous new bathroom-cum-wet-room,

downstairs is now complete.

OK, the changes we made on the first floor -

firstly, we've created a new bathroom in a dormer roof structure.

In doing so, this also allowed us

to create an airing cupboard on the opposite side.

The room behind me has more or less stayed the same.

We introduced a VELUX window which gives lots of natural light into this bigger landing.

The other thing we did was to shorten the back bedroom.

The door line used to be here,

but we've moved it back onto this line here.

In the back bedroom, we just decorated,

we re-plastered the whole thing.

We also rationalised the storage space,

which gives storage space so it would be great for families and children.

I think the addition of the bathroom on this floor,

along with the skylight, now really makes the space work.

You can see that the whole bungalow has been re-jigged to maximize and enhance the living space.

It shows both good design and build qualities.

We've both played the roles that I guess are our backgrounds.

He's an architect, um, he's not very hands-on.

I've also done my best to roll my sleeves up

and get involved with the build itself.

There's a few times he's like, "Why don't we do this?"

I'm like, "No, why don't we do this?"

And he's like, "Oh, yeah."

But I think that's why the partnership's worked well

because we do have different knowledge fields, and collectively,

have a good span of knowledge.

These guys really have combined their skills,

the A-Team of property development.

So, having successfully completed their first mission

and got the bungalow sorted,

what about that possible development at the back?

With regards to the plot of land, we've, sort of, been advised

that it's better to keep it as a piece of land

that doesn't have planning permission on it

to the point where we sell this property.

After talking to the agents, they've all said, "Flats, flats, flats, flats."

A scheme, which we've taken to the planners -

a five, one-bed apartment block on the land

And the block would resemble a pair of semis in truth,

with four in the main body of the property and one in the roof.

They're not opposed to it, but there will be hurdles.

So it's still in the balance, and at present, there's no certainty

that Pete's plan will ever make it off the drawing board.

Can they afford for it to fail?

Our original budget was about £30,000.

We're currently more like, sort of, mid-60s at the moment.

But we've done a lot more - we planned to come in here and just decorate,

we bought it for the land out back,

so we could turn this one round quickly,

but there were so many options to turn it from a bungalow into a family home.

They paid £193,000 for both the bungalow and the land

and have spent a further £65,000 on the bungalow.

With costs, this means their total outlay is about £260,000.

So can the bungalow alone recoup the investment?

What do two local estate agents think?

I think the changes that have been made to the property are pretty exceptional,

considering what it was like when I first visited.

The changes to upstairs and to include the downstairs bathroom

and upstairs shower room was very wise.

I love it. They've completed the works to a very high standard

and it looks really good.

So, encouraging comments,

but will that translate into a healthy end-value

after Pete and Mark's investment of around £260,000 here.

This property could resell for around £275,000.

In the present market,

I would consider this property would sell at £250,000.

At 250, you know, that would still be acceptable.

We'd still come out of it with a cheap piece of land to build.

Yes, that's good, they're around break-even point before a brick's been laid.

But if they can get the five-apartment plan approved,

what kind of profit could they hope for?

If they got planning permission for apartments,

I'd expect they'd be able to get about five apartments built.

Um, one-beds, of which I would expect them to command a sale price of around about £100,000 to £120,000.

We would like to think that if we could get five on there,

there would be two that were a pure profit,

which would be one each.

And we have said that we would probably...

If we could walk away with one property each,

we would keep them ourselves and rent them

and then re-mortgage them to buy our next piece of land,

so we'd have a constant money source for us.

If that all works they would both be in a good position

to invest in another project together and keep the business partnership going.

So is that the plan?

Yeah. No, I think the experience so far has been a very positive one for both of us.

Almost life-changing, certainly financially, and to just give us another direction in life.

Without a doubt, it's brilliant.

# It's a new dawn

# It's a new day

# It's a new life

# For me

# And I'm feeling good... #

And if they feel good now, just imagine what it will be like

if they get that all-important planning permission.

We're back in Southampton after nearly 18 months

to see how first-time developers, Tor and Julie,

fared renovating their two-bedroom bungalow.

They bought it for £135,000, but hadn't seen the property

or done any homework on it before the auction.

-So you not only didn't visit the property, but you didn't know anything about its legal status?

-No.

This is breaking all of the rules and I know it's not what you should do.

Now, outside the most stark, and in my view saddest, change

is the loss of the turret with its gorgeous bay window.

It's been replaced by a conventional pitched roof.

# Give me one good reason... #

The turret in itself was literally falling down

so I could have kicked the walls out.

And there was no foundations under it, so...it just had to go.

# Yeah, we're just waiting

# For the hammer to fall, yeah... #

The solution has taken away some of the charm of this house,

but I can understand the reasoning behind it.

It's been up to Tor to wield his mighty hammer

and almost single-handedly undertake all the repair work.

There are still two rooms at the front, which have been re-plastered

and both sets of windows have been replaced.

Around the back, the property has been hugely extended.

When we first bought it, it was virtually derelict,

it was small, it hadn't really had anything done to it for a long time.

The garden was completely overgrown,

there was a derelict garage in the garden as well.

Our plans expanded as we...

At first we were just going to go for a fairly small extension

and maybe add about 25% on,

but then we realised that we would make more of the house

if we went for larger, so we've double the house and more,

it's now 110 square metres.

We've added on a large extension at the back which provides living, kitchen and dining,

and then we've changed around all the inside, haven't we?

-Yes. All the rooms have been altered so nothing is where it used to be before.

-Mmm.

It has been a major job, yes.

Where there were smaller individual rooms

branching off a cramped corridor,

there is now this huge, bright open interior space.

Tor and Julie have tried to bring a taste of Scandinavian luxury

to the south coast of England.

And I'm pretty sure that bath won't be staying there.

Their vision is clear to see -

they've set about creating a unique and spacious open-plan living area.

One of the rooms that warranted serious modernisation was the kitchen,

this is now part of the extension.

Well, we are now in the extension

and the extension has actually doubled the size of the house

and it's the extension that we are the most proud of.

Contemporary look, we really enjoy it, we like it a lot.

We have the new kitchen units,

we have the open-space living room/dining room.

It has come together exactly how we wanted it to and we are very proud of it.

One of the more unique aspects of this development

is that the property is now, effectively, a two-storey bungalow.

There's been considerable development upstairs in the loft.

Tor and Julie plan for this to become a third bedroom with space for an en-suite wet room.

It will add something extra to the bungalow.

I think we've achieved the Scandinavian feel.

It's very open-plan, this large extension is very open-plan.

The rest of the house, too, has that feel to it, or it will when it's finished -

it will be very modern, very contemporary.

Their initial plan was to turn the renovation around in six months,

but here we are nearly a year and a half later, so what happened?

The reason why we made it such a big job

was that we went for permitted development at first,

then we realised that it just doesn't work,

so we decided to go for planning and this is what we ended up with.

# Problems Problems

# Pro-oh-oh-oh-blems... #

Some parts of this property needed urgent attention,

for instance - the floorboards eaten away by woodworm.

Tor's solution to that is very simple.

We will just take out absolutely every single floorboard

and we will just redo the joists.

Put in new joists and just get rid of it that way.

Even with the savings made thanks to Tor's handyman endeavours,

the costs must have spiralled well beyond their initial estimate of 50,000.

We will come in on around 100,000, yeah.

-When it's finished.

-When it's finished, yeah.

The roof with the skylights, that is probably close to 10,000, yeah.

They bought the house for £135,000.

So with the projected redevelopment budget of 100,000, that's a lot of ground to catch up.

We invited two local estate agents around to give us their opinions.

This is my second time to the property.

It is a complete transformation. Obviously, it's an ongoing project,

but it's good to see that it's moving ahead.

A few subtle changes here and there -

I've noticed that the circular bay to the front of the property has gone

which is a disappointment because I thought that was a nice feature.

Looking around, the property is fantastic,

although it's not completely finished.

I think, just looking at what they've planned -

I think they've utilised the space really, really well,

the finish and the spec looks really good, lots of light.

I think they've done a fantastic job.

Once this is fully renovated I think the property will probably have a value of around £250,000.

If we were to put this on for sale,

I'd like to see it on between £240,000 and £250,000.

That would be our minimum.

Yeah, that would be our minimum. We would not make a huge profit on that,

but this hasn't really been that much about making a huge profit,

this has been about learning how to do this and I'm pleased with that.

Once completed, this house could still generate some profit for the couple.

What if they were to try renting it?

Once fully renovated, I think it has a rental valuation of around £900 per calendar month.

Once completed, I think rental value-wise,

we would probably put it on the market

at around £900 to £950 per calendar month.

I don't think, at the moment, we're considering renting

because the finish will be very high standard, won't it?

Yeah. We haven't really made any definite decisions about that,

but it doesn't look as if we are going for the rental market.

We will stay in it ourselves for a little while and then we'll sell it on.

Tor and Julie plan to move into the house within the next three weeks and finish off the remaining work.

What are their thoughts on the project now it's nearing completion?

Recently, I've started to feel quite proud about it

and I have enjoyed working, I've enjoyed doing the work.

-We're tired but we're not burned out.

-No, not at all.

I've played more of a supporting role,

but still, it's been the two of us as a team and I'm proud of it,

I think we've produced a good house.

I think it's well designed, well built,

people are going to be happy living here in the future

and I think that's...

Yeah, we've put our stamp on this, haven't we?

-Yes, we have.

-And that's a good thing.

That's it, but don't despair, there is plenty more out there.

Yes, so join us next time for more Homes Under The Hammer.

-Goodbye.

-Goodbye.

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