Episode 22 Homes Under the Hammer


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Episode 22

Martin Roberts and Lucy Alexander visit a house in Southampton, a property in London and a three-bedroom end-of-terrace in Nottinghamshire and find out who bought them.


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Welcome to Homes Under The Hammer.

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Whether it's a plot, a home or a commercial opportunity...

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There's always a huge variety on offer in an auction catalogue.

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So, join us now as we follow some of the thousands of people who buy their home under the hammer.

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The bidding process can be quite a nerve-racking experience.

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But, if you've done your research and you've worked out your budget,

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you could actually enjoy it.

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So, let's see what today's bidders bought.

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This house in Southampton's been extended.

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There are plenty of rooms, but where will they end?

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It's very long. It just goes on and on and on.

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In London, I reckon this property had a remarkably low guide price.

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Ching, ching!

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Now, for that guide price, you really are getting your money's worth.

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And this three-bedroom end-of-terrace in Nottinghamshire's

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ideal for someone with a burning love of features.

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A very small fireplace, but it is a feature.

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All of these properties went to auction

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

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That is yours, sir.

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You don't have to be a property expert to know that property prices have gone south, recently.

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South is exactly where I am, in the southern city of Southampton,

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home to the Spitfire and from where the Titanic

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sailed on its doomed maiden voyage.

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So, two iconic periods of British history in one location.

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But will today's property, which had a guide price of 115,000 to 120,000,

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leave me on cloud nine or sinking in despair?

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Well, it's an oddly shaped, detached house

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with three or maybe four bedrooms,

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depending on how you configure this rather higgledy-piggledy place behind the shop.

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Now, here's a classic example of why you need to visit a property

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before you think about buying it.

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According to the auction catalogue,

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this is a three-bedroom detached house.

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Further down the particulars,

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it says the commercial ground floor shop is not included with the freehold title.

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That shop is this shop here. The property that's up for auction is adjoining the back of it.

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What's very significant, is that one of the rooms of that property

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actually comes right above this shop.

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It's what they call a flying freehold.

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That is significant and could give complications when it comes to the legal side of things.

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It's another example of why it's really important

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to look at the catalogue and to read the legal pack.

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Let's take a look inside.

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The property went to auction at a guide price of 115,000 to 120,000.

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# Come fly with me Let's fly, let's fly away... #

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Bearing that flying freehold in mind,

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let's see if the inside hits the heights.

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First impressions, well, a very steep staircase.

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There's an immediate return there. We'll check that out in a minute.

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The other thing I noticed is the fact we've got this concrete floor.

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Obviously not original and, who knows how that's been put in.

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In fact, what I'm seeing is, it looks to me like somebody

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has already started doing some work on a damp problem.

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If this floor wasn't put in right, that could well have been

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a deciding factor in terms of creating a damp problem.

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I'm a bit concerned about the huge great holes in the walls.

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Not supported very well at all.

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Obviously, some serious work going on there

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to try and solve what was probably a serious problem with damp.

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I'm puzzled. Did the previous owner start the renovation,

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hit major problems and decide to give up and sell,

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or has the new owner started work already?

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More digging and brick removal in the rear sitting room.

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Really serious amounts of the wall been taken away.

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It's not a bad-sized space. The house itself is interesting.

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It's very long. It just goes on, and on, and on.

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The kitchen here, the units don't look like they're that old to me.

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They're clearly very tired and you could definitely give this place

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a bit of a spruce by sorting this room out. Then it carries on.

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Down this corridor where you'll find the only loo and bathroom in the property.

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That's not ideal. There's a separate door there which is interesting.

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It gives you flexibility in terms of how you might actually use this place.

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Especially when I tell you that there's yet another bedroom.

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It's classed as a reception room at the moment.

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I don't know why. It's a bedroom.

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This property's had more extensions

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than a footballer's wife's hair.

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It just goes on and on.

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And there's still this large back garden.

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Time to view the top floor.

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Here we have that staircase with the interesting return.

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It could actually be the solution to our problems.

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Up here there are problems.

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Small landing. To the front you've got a bedroom which flies over the top

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of the property downstairs.

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That's your flying freehold. The problems, more seriously, are here.

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Bedroom two here, but bedroom three can only be accessed

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through bedroom two, so that isn't ideal.

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The solution could be to swap around the the stairs to create a corridor.

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It would then give you the individual access to each of these rooms.

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That's what you need to do.

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Although the property's large enough,

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I would resist the temptation to convert it into two flats.

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If you could sort out the stairs and create separate access to each bedroom,

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renting out each individual room then becomes a more attractive proposition.

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What will a local estate agent think

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of this property with its flying freehold?

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Remember, it went to auction with a guide price of 115,000 to 120,000.

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It needs a fair bit of work doing to it. Work has probably started.

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It's got a lot of bedrooms and a lot of reception rooms.

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It has got the potential to become a good investment.

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There is a fair amount of reworking that needs to be done

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to the property to allow that.

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Landlords around here would look at it as the bedrooms -

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three bedrooms, two reception rooms, potentially a four or five-bedroom let.

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When you've got rooms that go through from one to another,

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obviously, it can't be accommodated for bedrooms along those lines.

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And, of course, there's the issue of that flying freehold.

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This is the property for an experienced developer.

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How much could it be worth once completely renovated?

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What rental income could be achieved as a single let?

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Rental valuation for the property, as a whole property,

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would probably be around £700 per calendar month.

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Resale valuation for the property, once renovated, would be approximately £160,000.

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# Come fly with me, let's fly let's fly away... #

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Well, interesting one, this one.

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A lot of property and good potential for a buy-to-let, I would say.

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However, I am concerned about that flying freehold.

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Let's hope whoever bought it checked it out

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before they paid their money at auction.

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We're now going to go to lot 24,

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This is a three-bedroom property with three separate reception rooms.

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An ideal landlord or investment purchase.

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I'm going to open the bidding on this.

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Somebody wish to start at just £110,000? 110 we have. Thank you.

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I now need £111,000.

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111 with you, sir.

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Back to you at 112. 112 we have got.

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113? 113,000. 114?

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Now, I need 115. 115. I need 116.

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116,000 is bid.

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117's on the telephone.

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117 on the telephone.

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The gentleman's back at 118.

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119,000. I've got 119 here on the phone, we're looking for 120.

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119,500.

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120 is bid on the telephone.

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Now looking for 120,500.

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120,500 is now back in the room.

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120,500.

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No, a shake of the head from the telephone table.

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To you, sir, for the first, at 120,500 for the second,

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for the third and final time, sold to you, sir. Your number, please.

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The final successful bid of 120,500 was made by Jason.

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He's a bit of an expert at property restoration.

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I met up with him at his new purchase to hear about his plans.

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-Jason, good to meet you. Congratulations!

-Thank you.

-Why did you want to buy this place?

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It was primarily to protect the shop

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which I've worked on for about two years.

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-You own the antiques shop at the front?

-I do, yes.

-Oh, great!

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I wanted to protect it from unknown tenants and that sort of thing.

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I spent about two years restoring it.

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I went to endless lengths to try to do it the way a Victorian would do it.

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Working on listed buildings is really what I'd like to do.

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For the moment, I think this will have to do.

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You've gone for something which is fairly straightforward here.

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I guess you're interested in this because you own the building down below.

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-Yes.

-That wasn't a problem.

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Correct, yes.

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-You know the bloke who owns the place above?

-I'm not going to sue myself.

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What's the plan for the place?

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I could knock it into five-bedroom lets.

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I think it's a little bit cramped and I would limit

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the kind of person that would want it.

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I probably will make it a four bedroom let.

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Before that happens, Jason's got to sort out the layout.

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But judging by the attention to detail he has showed in his shop

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that could prove pricey.

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What are you going to do about the layout upstairs

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cos it's not ideal, is it? You need a corridor up there.

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Well, there's more than one way of doing this,

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but my current thoughts, if I'm entirely honest,

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are to take six steps off the landing

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holding on to that wall there

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and come in to the first room, the middle room.

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-Oh.

-And have a dry line wall going into the end room

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so that I have created three rooms instead of two lettable rooms.

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So you can go up 90 degrees or you can go straight on to another six steps

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which then lead into a corridor which connects up to the end room.

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What about downstairs?

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Well, I'm being a touch more practical with this building

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than the one at the front.

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Probably a new kitchen. The bathroom I may well leave alone.

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Apart from the tiles. Then the carpets throughout.

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-It's not that big a job.

-How much are you planning to spend?

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I think it could cost, including interest payments to the bank,

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about £16,000, but if it went to about £21,000

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that wouldn't surprise me at all.

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Who's doing the work?

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Me and somebody I've known for a few years, he's very good.

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We'll just use odd bits of labour here and there

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bring in plumbers when we need them.

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Jason's determined to do this property up to the highest standard.

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But I'm worried he's losing touch with the limited potential here.

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I feel his first love is renovation.

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He showed me the major work that he's already started to tackle, the damp.

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Well, tell me what an Earth you've started to do here?

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Well...it had some appalling damp problems.

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I've got all these meters and it was shooting right up to the top of the scale.

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What we're doing is, you do it in small sections at a time...

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You've taken massive amounts out of this wall. Won't it fall down?

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No, it doesn't worry me, greatly.

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This, this isn't the old Victorian plaster.

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This is modern cement, you can see the grey colour.

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It's very strong and it will hold it up.

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You can do about a metre at a time quite safely.

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Just build it up again with, I think, three damp courses.

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The original one that's slate will then feed a plastic because

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plastic you can bond together well with various things.

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The top one will be lead and nothing will ever pass through lead.

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-That's this here?

-Yes.

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-You're literally putting a layer of lead all around here?

-Yes.

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One thing's for sure, nobody can accuse you of not doing a proper job of it.

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-That's very kind, thank you.

-It's true. Good luck with it all.

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-Pleasure.

-We look forward to seeing how it turns out.

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Good, so do I.

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There are all sorts of reasons why people buy property

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and, for Jason, guaranteeing he's not going to have nasty neighbours was a major one.

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You certainly can't argue that he's going to

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do a great job on sorting out the damp.

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As to everything else, you can find out how he gets on later in the show.

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For the next property that went under the hammer, I've come to Plumstead,

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a suburb of the London Borough of Greenwich.

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With transport links to the city centre, this could be a plumb place to find property bargains.

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This is Vicarage Park.

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It's an area that's predominantly Victorian houses.

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Here's the property. It had a guide price of £200,000 to £225,000.

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A small price to play for three flats in this four-storey house

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with great links to the centre of town.

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It's looking a little bit sad and grubby on the outside.

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I'm going to have a look inside.

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The run down exterior might explain why that guide price was so low.

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And I don't you think it's a hopeful sign for the state of the interior either.

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Now... this house has obviously been empty for long time

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judging by the sea of newspapers and letters everywhere.

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There's a few Christmas decorations thrown into the equation, as well.

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But on first glance, it's looking rather tatty.

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We've got wallpaper hanging off everywhere. There's a bathroom here.

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Kitchen at the back, bedroom to the right

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and a really nice sized lounge and high-ceiling.

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Big bay window there.

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It's got the bones of being a nice property.

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But I just want to explore a bit more first.

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At the back there's a drab and dingy yard which feels a bit oppressive.

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But it does lead-up to a surprisingly large, overgrown garden

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and that, I reckon, has real potential.

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As for the house, there are another three floors

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and two flats to see so it's onwards and upwards.

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Now, this is the first floor flat.

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You don't know what you're going to find every time you open a door.

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There's lots of rooms. It's a bit of a maze in here.

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A kitchen area, you've got a bedroom, a bathroom

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and to the front of the property a rather large sitting room area.

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You've got nice high ceilings in here.

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I've got to say, it's quite a good space

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with lots of light coming in.

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But it feels like it's been carved up in a rather odd way.

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I'd employ the skills of an architect to really have

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a good, hard look at this building and think of a much better layout.

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Sadly, you've got no beautiful original features.

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You do have this rather big sash bay window.

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But somebody's decided to stick some lead on the windows

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to give you that sort of leaded light effect.

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It's not really working for me, I have to say!

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Let's go upstairs and see what's going on on the top floor.

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Upstairs, there's a split level flat with three good-sized bedrooms.

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It extends up into the attic space and has got me thinking,

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did the original owner miss a trick here by only having three flats?

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I think there's a lot of potential with this building

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and here is why. I would divide this flat in to two separate dwellings

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with its own front door just here.

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I would also create a ground-floor extension and call that a two bed.

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Making this property four separate units, not three as it's currently laid out.

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Ching, ching!

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Now for that guide price you are getting your money's worth.

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Remember the property went to auction guided at £200,000 - £225,000.

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Creating a fourth flat would require a further separate bathroom and kitchen.

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But it could prove to be a very valuable option.

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Time to ask a local estate agent

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what he thinks is the best way ahead.

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Is there any potential in converting it back into one family home?

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I don't see the benefit of doing that, financially,

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there's not the money in this area because

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the prices in this area will be capped off

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and you really wouldn't get the money back.

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It's always best to split them into flats,

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you'll get a lot more money back that way.

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With a good renovation of the three flats costing about

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£65,000 - £70,000, what sort of returns are we talking about?

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For a one-bedroom you'd be looking at about 130,000 - 135,000.

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For a two bedroom, you'd be looking at £150,000 - £160,000.

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So with that current layout, the flats could fetch a total of £430,000.

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And the rental returns offer a very healthy 9% yield.

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So, definitely a great one to go for.

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I think it's a fab rental property in an ideal area.

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Let's see who took this on when it went under the hammer.

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Lot 160.

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Freehold mid-terraced building with two self-contained flats

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and self-contained maisonettes. Where shall we start?

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Someone give me 180. Thank you, sir.

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180 sitting on my left. 182,500?

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182,500. 185,000.

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185,000. 187,500.

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187,500 on the doorway.

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190,000 over there. 192,500?

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192,500. 195,00, 197,500?

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200,000. 202,500. 205,000. 207,500.

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210. 212,500.

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215,000. 217,500.

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220,00, 222,500. 225,000, 227,500.

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230,000. 232,500. 235,000. 237,500.

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240,000. 242,500? No?

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It's your bid at 240,000. 242,500?

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Thank you. 242,500. 245,000? 247,500?

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Right behind you, 247,500. 250,000 sitting down.

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252,500.

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It's with you, sir, sitting down.

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255,000. 257,500 anywhere else?

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Back on the door. 257,500.

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260,000. 262,500? No? Why not?

0:18:580:19:01

261,000. 262,000. 263,000.

0:19:010:19:05

No?

0:19:050:19:07

Still with you here, reservation sir, at 262,000 on my left.

0:19:070:19:10

The first time at 262,000, the second at 262,000

0:19:100:19:15

and for the third and final time at £262,000.

0:19:150:19:18

Are we all done? I think we are.

0:19:180:19:20

Sold to you sir at £260,000.

0:19:200:19:22

Well fought, sir.

0:19:220:19:24

That successful and really keen bidder

0:19:260:19:29

is Mayur and his wife Anjenna.

0:19:290:19:32

They bought these flats for £262,000

0:19:320:19:37

£47,000 over the top guide price of £225,000.

0:19:370:19:41

Guys, congratulations.

0:19:420:19:44

I've got to say, you looked very keen and very happy at the end of that auction.

0:19:440:19:49

I was indeed.

0:19:490:19:51

What's the story behind you keeping your hand up in the air?

0:19:510:19:54

I thought if my hand is up in the air, all the other bidders will realise this hand isn't going down.

0:19:540:19:59

And say, "OK, this guy's not going down, let's stop".

0:19:590:20:02

Fortunately everybody else put their hands down.

0:20:020:20:05

We couldn't see you because you were hiding behind somebody else. 262,000 is a good price.

0:20:050:20:10

It's a good price and during the auction I was thinking, don't keep your hand up, put your hand down.

0:20:100:20:16

But I didn't know what his game plan was.

0:20:160:20:19

Mayur's individual bidding strategy certainly paid off and that's not all.

0:20:190:20:26

They bought without viewing it first.

0:20:260:20:28

It was recommended by Suresh, a trusted friend who's also a property sourcer.

0:20:280:20:33

That was unusual, but the real surprise came when they told me why they had bought the house.

0:20:330:20:40

We've got another two properties that are rented out at the moment.

0:20:400:20:43

We want to go and live in India and work on a couple of projects.

0:20:430:20:46

One project is for underprivileged children and we want to run a school for them.

0:20:460:20:50

The other project is going from one village to another providing sanitation for them.

0:20:500:20:56

Fantastic. That's such an amazing cause.

0:20:560:20:59

You guys are working really hard to get this up and running so you can ultimately go out and help others?

0:20:590:21:03

-That's right.

-How involved have you been out in India with these projects?

0:21:030:21:07

We got married in the foothills of the Himalayas and they are running

0:21:070:21:11

some projects so we want to get involved with them.

0:21:110:21:14

So, Anjenna, how do you feel about the project in India?

0:21:140:21:17

I'm quite excited about it.

0:21:170:21:19

I love India, I love the weather, so I'm looking forward to it.

0:21:190:21:24

It's a completely different change of lifestyle, so I'm looking forward to it.

0:21:240:21:29

What a fantastic reason for getting into property developing.

0:21:290:21:33

Although this purchase is but a step to even bigger things beyond, what have they planned here?

0:21:330:21:38

At the moment on the ground floor we've got a one-bedroom flat.

0:21:380:21:41

We're going to turn that into a two-bedroom flat.

0:21:410:21:45

On the ground floor there's going to be an extension at the back as well.

0:21:450:21:48

The first floor at the moment is a one-bedroom flat.

0:21:480:21:52

We're going to turn that into a two-bedroom flat as well.

0:21:520:21:55

The second and the third floor are a three-bedroom flat. We'll change the second floor into a two-bedroom flat.

0:21:550:22:01

And the top, we'll turn into a one-bedroom flat.

0:22:010:22:04

I reckon adding that fourth flat on the top floor is the best way to take this place forward,

0:22:040:22:08

but to achieve that the couple have given their team of builders

0:22:080:22:12

a pretty hectic renovation schedule of three to four months.

0:22:120:22:16

Mayur has bags of confidence, but little in the way of project managing experience.

0:22:160:22:21

I expect that timescale might prove a bit tight.

0:22:210:22:25

What's your budget for the work here?

0:22:270:22:28

The budget is 75,000 all in, 65,000 for the builders and 10,000 for the expenses.

0:22:280:22:34

How are you going to finance that?

0:22:340:22:37

Greenwich council have got this regeneration scheme at the moment,

0:22:370:22:40

whereby if there's a property that has been empty for more than six months, which this building has been,

0:22:400:22:45

they'll pay up to 75% of the renovation costs.

0:22:450:22:48

If I let it out to the council again.

0:22:480:22:51

-So are you going to let it out to council tenants?

-Yes, we are.

0:22:510:22:55

What happens if you then decide to sell on?

0:22:550:22:57

You can't sell it for five years. We have to rent it out for five years.

0:22:570:23:01

But we don't, this is a long-term project for us.

0:23:010:23:03

While the council will part-fund the refurbishment, the money to buy on auction day came from Anjenna.

0:23:030:23:10

Mayur has certainly got the property bug, but what's her favourite aspect of property development?

0:23:100:23:15

-I don't like anything about it.

-Charming!

0:23:150:23:17

Why are you doing this?

0:23:170:23:20

Is this to support your husband?

0:23:200:23:22

Yes, it's a good investment. I'm not going to get my hands dirty, but the potential is good.

0:23:220:23:29

OK, she's telling you fair and square and straight here and now, she's not going to be helping.

0:23:290:23:33

I'm financing the properties. All the money is coming from me.

0:23:330:23:37

He's just doing all the hard work. He's working for me really.

0:23:370:23:42

What's the one thing that you're worried about with this?

0:23:420:23:45

Maybe I'm just a little bit naive, but at the moment I'm not worried about anything.

0:23:450:23:50

You're very positive.

0:23:500:23:51

Look at that big grin. Have you ever seen such a big grin on a guy?

0:23:510:23:55

That's what worries me.

0:23:550:23:57

-Is he always this happy?

-Yes, he is.

0:23:570:24:00

Very much so. It's contagious.

0:24:000:24:04

-Good luck with this project. I hope you manage to finish in four months.

-I hope so too. Thank you.

0:24:040:24:09

-Well done. Anjenna.

-Thank you.

-Thank you very much.

0:24:090:24:12

So Mayur and Anjenna are taking on a mammoth project with,

0:24:170:24:21

not a lot of experience behind them.

0:24:210:24:24

I've got doubts about their timescale.

0:24:240:24:26

Just three to four months.

0:24:260:24:29

Mayur is just so laid back.

0:24:290:24:31

Will they make it to the foothills of the Himalayas to start the next chapter of their lives?

0:24:310:24:37

I really hope so. You can find out what happens later on in the programme.

0:24:370:24:42

Coming up: I unearth a plus point behind this end-of-terrace house in Nottinghamshire.

0:24:420:24:48

If it's going to be a family home, it's a nice bit of space for the kids to play in.

0:24:480:24:52

We return to this property in London where Anjenna hasn't just provided

0:24:520:24:56

the finance, she's been busy getting everyone working.

0:24:560:24:59

Yes, definitely I've been cracking the whip. It's been fun.

0:24:590:25:03

But first in Southampton hindsight is a wonderful thing.

0:25:050:25:08

If I hadn't had the shop attached to this building, I'd have taken one look at it and walked out again.

0:25:080:25:12

Back to Southampton where early in the programme Jason paid £120,500 for this building.

0:25:150:25:23

It was behind the antique shop he already owned and he planned to rent out individual rooms.

0:25:230:25:28

But there were problems.

0:25:280:25:30

The property suffered from damp and although it was very long,

0:25:300:25:32

access to the third upstairs bedroom was through the second bedroom.

0:25:320:25:37

So he plans to move the stairs and create a new corridor.

0:25:370:25:42

18 months later we've returned and Jason's Antiques stock seems to have expanded.

0:25:420:25:49

While at the back, the garden needs a bit of attention.

0:25:490:25:53

Heading inside, the downstairs room right at the back of the property is

0:25:530:25:57

now a bedroom with some character furniture that Jason has obviously found through his antiques contacts.

0:25:570:26:05

There's now lovely parquet flooring too.

0:26:050:26:07

The modern bathroom suite has also been replaced with period pieces and beautiful reclaimed tiles.

0:26:070:26:13

Although a wall has been moved in the kitchen and it's had a makeover,

0:26:130:26:17

the rest of the downstairs is still to be finished.

0:26:170:26:20

So, how has the top floor fared?

0:26:200:26:22

Jason took us up there on his new staircase to find out.

0:26:220:26:26

This was the Victorian staircase that was originally there.

0:26:260:26:31

As part of the plan that was originally for bedsits.

0:26:310:26:34

I knocked all this down and put some stairs in.

0:26:340:26:37

But the problem that I realised was essentially this was like going into a cell. It was extremely dingy.

0:26:370:26:45

With interest rates low I realised a flat was financially possible,

0:26:450:26:48

so the compromise I came up with was to knock this through and make a kitchen there,

0:26:480:26:52

so there will be a butler sink by the window,

0:26:520:26:55

the bedroom over there, and the bathroom there.

0:26:550:26:59

The joists will have to be altered in the kitchen but that's about it.

0:26:590:27:02

So in the end Jason decided to convert the property into two

0:27:020:27:06

flats and let them out, rather than the three individual rooms.

0:27:060:27:10

But after 18 months, progress has been a bit slow,

0:27:100:27:14

although Jason seems resigned to the time it's taking.

0:27:140:27:18

When I first bought the property I realised that dampness was the biggest issue here.

0:27:180:27:23

The dampness went on and on and on.

0:27:230:27:25

The floors had to be dug up because of rats pulling up all the plastic PVC, the dampness going everywhere.

0:27:250:27:31

After a lot of back-breaking work the damp has now been cured.

0:27:310:27:35

How much has all this cost?

0:27:350:27:38

My initial budget was 16,000.

0:27:380:27:40

I was going to do what a lot of people do, a slap of paint etc.

0:27:400:27:44

It's just tipping over 60,000 and will come in about 70,000.

0:27:440:27:48

Ouch! That's over four times his predicted budget.

0:27:480:27:52

OK, he's had the added expense of separate meters for the two flats but this property is turning into

0:27:520:27:57

a money pit and it's still not finished.

0:27:570:28:01

To keep the two flats separate, one of the downstairs rooms needs to be divided.

0:28:010:28:06

Jason intends to put in a Victorian French window to add character.

0:28:060:28:10

Once that's done, will the upstairs flat be finished? What's left to do?

0:28:100:28:16

On the first-floor flat there's a bathroom to fit.

0:28:160:28:20

Some electrical work.

0:28:200:28:22

We'll probably change all the doors upstairs because I don't like these fire doors, with old Victorian doors.

0:28:220:28:29

Sand the floorboards, fit the kitchen.

0:28:290:28:32

Although the ground floor flat is still very much work in progress,

0:28:320:28:36

Jason has already let it out to a friend who runs the antiques shop.

0:28:360:28:40

And he's got somebody in mind for the top-floor flat as well.

0:28:400:28:44

Time to discover what two local estate agents

0:28:470:28:50

think of Jason's buy-to-let.

0:28:500:28:52

How much do they reckon he could rent the two flats for once finished?

0:28:520:28:56

I think the conversion is looking good.

0:28:560:28:59

If I was to buy the property, I'd be doing the same thing.

0:28:590:29:03

The previous layout of the property was slightly unusual so it did need to be rectified.

0:29:030:29:07

I think what they're doing at the moment works quite well.

0:29:070:29:10

The ground floor flat conversion works very well.

0:29:100:29:14

I think it's been a good investment.

0:29:140:29:16

I'd have liked to have seen a finished product a lot sooner.

0:29:160:29:20

I think the conversion is taking a long time.

0:29:200:29:24

Jason has already let out the downstairs flat for £525 per calendar month.

0:29:240:29:30

He anticipates a similar figure from his top floor tenant.

0:29:300:29:33

How much would the experts suggest?

0:29:330:29:36

For the rental market I would visualise the downstairs flat

0:29:360:29:40

going on the market in the region of 550 per calendar month.

0:29:400:29:44

With the upstairs flat, 575 - 595.

0:29:440:29:48

For one-bedroom flats in this local area

0:29:480:29:51

you're probably looking at around £500 per calendar month per flat.

0:29:510:29:55

A touch low. I thought they had, if I wanted to go for the absolute full money, about 550 each.

0:29:550:30:03

The average between the two does seem to be not a million miles away from it.

0:30:030:30:07

What about a resale valuation for the two flats once they're completed?

0:30:080:30:13

Jason paid £120,500 at the auction and his budget is heading towards £70,000.

0:30:130:30:19

It makes a total of around £191,000.

0:30:190:30:25

In terms of selling, once renovated and fully

0:30:250:30:28

completed you're probably looking at around £85,000 per property.

0:30:280:30:32

I could see the ground-floor property on the market for 120,000.

0:30:320:30:37

The upstairs flat, I would like to think we could achieve in the region of £125,000.

0:30:370:30:42

What does Jason think of that?

0:30:420:30:44

There's a huge difference between the two.

0:30:440:30:46

I'd have thought the ground floor one because it has the garden

0:30:460:30:50

about 100,000 and this one about 85,000 - maybe 90.

0:30:500:30:54

On those figures he'd just about break even.

0:30:540:30:56

Would he consider selling?

0:30:560:30:58

No, because I might eventually do other projects and sell them,

0:30:580:31:05

but this one I'll keep because it's attached to the shop.

0:31:050:31:08

Jason has definitely learnt a lot doing this project.

0:31:080:31:11

Long term I reckon he can't wait to tackle a really grand old property that needs lots of work. Am I right?

0:31:110:31:19

I'd love to renovate a listed building.

0:31:190:31:22

They cost a lot to do up.

0:31:220:31:25

With the current market, I don't think I can do that.

0:31:250:31:28

I think I'm stuck doing rental properties for the foreseeable future.

0:31:280:31:34

Anything wonderful is cancelled.

0:31:340:31:37

Now, where can you get a three-bedroom semi-detached house for a guide price of 45,000 quid?

0:31:410:31:49

Mansfield in Nottinghamshire.

0:31:490:31:51

It doesn't look too brilliant from the outside but look at this.

0:31:510:31:56

Amidst the mess and the chaos -

0:31:560:32:00

beauty flourishes.... Let's take a look inside.

0:32:000:32:05

# Sunflower

0:32:050:32:07

# Good morning

0:32:070:32:08

# You sure make it like a sunny day... #

0:32:080:32:13

Unfortunately the house itself isn't looking so pretty.

0:32:130:32:17

There are broken windows, missing roof tiles and that's just the outside.

0:32:170:32:22

With a classic British summer,

0:32:240:32:26

let's hope that the property is slightly more sunny.

0:32:260:32:31

No! What have we got?

0:32:350:32:37

We've got a loo there, a room there, I can't imagine what that is.

0:32:370:32:41

It's obviously in a right old state. It smells pretty damp. That's not surprising today, I guess.

0:32:410:32:48

The kitchen needs total refurbishment. It's not a bad-sized space, I have to say.

0:32:480:32:54

Through to the living room, again not a bad-sized space.

0:32:540:32:57

First thing I'd want to see are French doors out onto the garden.

0:32:570:33:01

I'm delighted to announce it does have a feature fireplace.

0:33:010:33:05

It's a very small fireplace, but it is a feature.

0:33:060:33:09

Remember that small feature is matched by a small guide price of just £45,000.

0:33:150:33:19

Not bad for a three-bedroomed semi.

0:33:190:33:23

OK, so the downstairs needs a lot of work, but what about up there?

0:33:230:33:29

Upstairs and you know what? I'm starting to really like this house.

0:33:290:33:32

It changes my opinion completely. What have we got?

0:33:320:33:35

Three reasonable-sized bedrooms.

0:33:350:33:37

You've already got the bathroom and the loo upstairs and

0:33:370:33:40

bearing in mind that guide price, you're not going far wrong, are you?

0:33:400:33:44

But now time for an interesting fact.

0:33:440:33:48

You may be wondering why the light fitting in the bedrooms

0:33:480:33:55

is towards this end of the bedroom rather than in the middle.

0:33:550:33:59

The reason is, allegedly, to maintain the modesty of the people in the room.

0:33:590:34:05

If you imagine you have a net curtain up here,

0:34:050:34:09

if the light fitting was here, then anything you'd be doing here would be silhouetted against the window.

0:34:090:34:14

If it's there, the only place you can get a silhouette is by standing here.

0:34:140:34:18

So you can be doing whatever you want here and nobody outside can see what you're up to.

0:34:180:34:23

That's the reason it's there. Of course it's true. It's true...

0:34:230:34:26

# I know this much is true... #

0:34:260:34:33

The sad truth here is that all three bedrooms are tired and shabby and in desperate need of a wake-up call.

0:34:330:34:39

The dated bathroom is looking pretty washed up too.

0:34:420:34:45

Let's head outside.

0:34:450:34:48

The plus point of the property is the garden. A reasonable size.

0:34:480:34:52

If you're thinking about renting this place out, you probably want to put low-maintenance stuff down,

0:34:520:34:57

so either shingle or some kind of a patio.

0:34:570:35:01

Either way if it's a family home, it's a nice bit of space for the kids to play in.

0:35:010:35:04

Now, that's a feature which makes this place extremely marketable.

0:35:060:35:10

People really value outside space and there's a lot here.

0:35:100:35:15

At the back it's clear there are roof issues and it may be worth

0:35:150:35:17

changing the windows for double glazed ones.

0:35:170:35:21

I invited a local estate agent to give me his opinion of the house

0:35:210:35:24

and find out what the area offers potential buyers.

0:35:240:35:28

I think Mansfield is unsung as an area because of its transport links.

0:35:280:35:32

We have good access to junctions 28 and 29 of the M1.

0:35:320:35:35

It does have its own train station and I think it's very well positioned in the centre of the country.

0:35:350:35:41

'Sounds good so far, but what about the house itself?

0:35:410:35:46

'What work is necessary?'

0:35:460:35:49

The property needs new double glazing.

0:35:490:35:52

I'd suggest an upgrade of the central heating system, refitting

0:35:520:35:56

of kitchen and bathroom and perhaps an updating of the wiring as well.

0:35:560:36:01

'With a guide price of £45,000, could buy-to-let be the best option here after renovation?'

0:36:010:36:07

The local rental market is always very strong and I could see this achieving £450 per calendar month.

0:36:070:36:14

'What could the resale value be?'

0:36:140:36:18

This property when renovated, I'd expect to be achieving in the region of £75,000.

0:36:180:36:23

It may not be in the best of areas and the house itself

0:36:230:36:26

needs a bit of sorting out, but the rental in this area is strong and it's a solid little place

0:36:260:36:32

that I think makes a great investment opportunity and that's what counts.

0:36:320:36:37

Let's see who spotted it when it went under the hammer.

0:36:370:36:40

Peel Crescent in Mansfield, 45?

0:36:440:36:47

£45,000 I have.

0:36:470:36:49

At 45,000, it's the opening bid.

0:36:490:36:51

46 is bid.

0:36:510:36:54

47, 48, 49 at the back.

0:36:540:36:59

50,000, £50,000. 51?

0:36:590:37:03

50 and a half.

0:37:030:37:05

51? 51.

0:37:050:37:07

51.500. 52,000, 52,500.

0:37:070:37:12

53. 53.500.

0:37:120:37:15

54, 55,000?

0:37:150:37:18

54 and a half against you.

0:37:180:37:21

Standing by the bar at £54,500.

0:37:210:37:26

55, a fresh bidder.

0:37:260:37:27

At £55,000, anyone else?

0:37:270:37:32

At £55,000 once. Five.

0:37:320:37:35

55,500. 56?

0:37:350:37:37

No?

0:37:370:37:39

At 55 and a half by the back wall, first time, second time, third and last opportunity.

0:37:390:37:47

Sold at 55 and a half.

0:37:470:37:49

Steve, a self-employed electrician, paid £55,500.

0:37:490:37:55

He bought it without even seeing it.

0:37:550:37:57

He plans to do the renovation work himself in his spare time

0:37:570:38:01

with his father Mick and sister Samantha, happy to lend a hand.

0:38:010:38:06

I met up with them while Steve was out on his day job.

0:38:060:38:09

So, why did Steve buy it?

0:38:100:38:14

Solely to renovate it all and in six months' time, hopefully, he'll pass it and sell it on,

0:38:140:38:21

then he's hoping to buy a couple more terraced houses and do them up and do the same.

0:38:210:38:26

Basically make some money out of it, I think.

0:38:260:38:28

Ah, yes! Making money is the name of the game.

0:38:280:38:33

What do they make of the job in hand?

0:38:330:38:35

It needs a lot of work.

0:38:350:38:36

So far! But it's got potential.

0:38:380:38:43

I think he's planning to look for a family to move in,

0:38:430:38:47

so there's local schools... so the area will suit families.

0:38:470:38:51

-He's checked the area. Yeah.

-Yeah.

0:38:510:38:54

What you think of it, Mick?

0:38:540:38:56

It wants a lot of work doing to it.

0:38:560:38:58

There has been a lot of mining subsidence here but that was about 20 years ago and he's looked into that.

0:38:580:39:04

-It's been underpinned and everything.

-As far as you're concerned, what are the big jobs going to be?

0:39:040:39:08

Mainly the kitchen and the bathroom.

0:39:080:39:11

I think they're one of the selling points of any house, really.

0:39:110:39:16

They have to put new windows in

0:39:160:39:18

and tile everywhere through.

0:39:180:39:21

He should do a good job. Doors, everything really. A complete refurb.

0:39:210:39:26

'So, quite a lot of work to do, but Mick's son Steve has grander plans for this three-bedroomed semi.'

0:39:260:39:34

-He's hoping to build an extension on to the back room somehow.

-Is he?

0:39:340:39:38

Yes and make a four bedroom, plus extend that.

0:39:380:39:41

Has he looked into the value around here because I'm not sure that's going to stack up, is it?

0:39:410:39:45

Well, he has looked at them. He's going to keep it for at least six months if not more,

0:39:450:39:49

and then hopefully the market will pick up and he'll sell it.

0:39:490:39:53

He's thinking about £90,000, but...

0:39:530:39:56

Right, but that's going to cost quite a lot to put the extension on, isn't it?

0:39:560:39:59

-He is going to do it himself anyway.

-Right.

0:39:590:40:01

-I'm doing the labouring. Helping.

-Oh, right. OK.

0:40:010:40:05

So we'll not paying any builders or anything to come and do it.

0:40:050:40:08

Roughly how much do you think it'll to cost to put the extension on?

0:40:080:40:12

He's worked it out at something like £4,500.

0:40:120:40:15

He was only going to do a breeze block thingy then render it, I think.

0:40:150:40:19

-That's what he's hoping.

-We're not talking about double-storey extension here?

0:40:190:40:23

Yes, hopefully to put another bedroom up there as well.

0:40:230:40:25

-For £4,500?

-Mmm.

0:40:250:40:28

Building a two-storey extension for £4,500 seems a little unrealistic to me.

0:40:290:40:35

Steve paid £55,000 at auction so what's his total budget for the refurbishment AND that extension?

0:40:350:40:42

I think it's £15,000 he's got.

0:40:450:40:48

He's hoping not to spend that amount but obviously that's what he's got.

0:40:480:40:52

That's his limit. It will, definitely, I think take six months.

0:40:520:40:56

What are you two going to get out of it?

0:40:560:40:57

You're doing all this work and I know it's family and all that...

0:40:570:41:01

For me it's just seeing it's all right, you know?

0:41:010:41:03

And I'll be on an hourly rate.

0:41:030:41:05

-Will you? Excellent!

-Or a daily rate, as he said.

-Really?

0:41:050:41:09

Samantha could be onto a winner with that daily rate as it could take

0:41:090:41:13

a very long time to remove all that wallpaper and woodchip.

0:41:130:41:18

But this isn't their first dip into the world of property development.

0:41:180:41:21

-I bought a bar five years ago in Tenerife.

-A bar in Tenerife? Oh!

0:41:210:41:25

And it needed a complete renovation, which we did, and that was quite an interesting project.

0:41:250:41:31

-Both of you were there?

-Yes, she went out before me and then I came out a few months later.

0:41:310:41:36

-Three or four months later.

-And ran a bar in Tenerife? Wow, what a thing. How was that?

0:41:360:41:40

Fantastic.

0:41:400:41:42

Yes, lovely. Better weather than this.

0:41:420:41:44

They sailed through that development in sunnier climbs and made a great success of it.

0:41:440:41:50

That bodes well for this property.

0:41:500:41:53

So the renovation of this house turning into a real family affair.

0:41:530:41:57

My only concern is that Steve listens to the advice and doesn't build that extension

0:41:570:42:01

which would put this property above the ceiling price of similar properties in the area.

0:42:010:42:07

You can find out how he gets on later in the show.

0:42:070:42:10

So we've left our buyers to their own devices.

0:42:120:42:16

I wonder what they've been up to?

0:42:160:42:18

Let's go back and find out.

0:42:180:42:20

Earlier in the programme in Plumstead, south-east London Mayur and his wife Anjenna

0:42:240:42:28

paid £262,000 for this mid-terrace property that was divided into three separate flats.

0:42:280:42:35

Anjenna had provided the financial investment

0:42:350:42:37

and she and Mayur plan to convert it into four flats which they hope to rent out.

0:42:370:42:43

They intended to use the income to provide help for a charity

0:42:430:42:46

in India and were going to move there to help with the work.

0:42:460:42:51

# Got to love The sweet taste of India... #

0:42:510:42:54

Four and a half months later the conversion has progressed very well.

0:42:550:42:59

On the ground floor, the kitchen is now a second bedroom,

0:43:010:43:05

while the original lounge has become the master bedroom.

0:43:050:43:09

A new bathroom has been installed.

0:43:090:43:11

Up on the first floor, that one-bedroom flat has also gained a second bedroom

0:43:110:43:16

and the lounge has been transformed into a main bedroom.

0:43:160:43:20

What became of the original bedroom?

0:43:200:43:24

When we first came, this used to be a bedroom.

0:43:240:43:26

What we did here was the kitchen used to be in that other room there which is now the second bedroom.

0:43:260:43:31

We turned this into a kitchen-diner/lounge-area and the space works out great.

0:43:310:43:35

You've got a kitchen here and you've got your living space here.

0:43:350:43:39

I'm really pleased with the way this has worked out.

0:43:390:43:41

There's been the same layout change on the second floor

0:43:440:43:47

where originally the third flat had continued up into the roof space.

0:43:470:43:51

Mayur and Anjenna are now waiting for planning permission

0:43:510:43:54

to convert the attic into a fourth one-bedroom flat.

0:43:540:43:57

That would take the property from three flats with five bedrooms to four flats with seven bedrooms.

0:43:570:44:04

Anjenna's particularly pleased with the ground-floor conversion.

0:44:040:44:08

This was the bedroom before and it was quite dark so what we decided to do was open up the, there was a

0:44:080:44:14

window here, so we opened up the wall and created an extension and turned this into the kitchen.

0:44:140:44:19

Now what we've got is a kitchen/lounge.

0:44:190:44:21

I really like this space. This is my favourite room in the whole house.

0:44:210:44:26

Now the ground floor flat opens out into its own patio.

0:44:280:44:33

All the flats will share the garden and decking area, once completed.

0:44:330:44:38

Of course, if the fourth flat does get the go-ahead, rental income on the property will increase.

0:44:380:44:43

That's something Anjenna would like as she's looking after the money!

0:44:430:44:47

But who's been responsible for all the work here?

0:44:470:44:50

I've got a fantastic set of builders. Sonny and Sabby.

0:44:500:44:53

They've worked hard. They've also worked long hours as well.

0:44:530:44:56

Till about 9 o'clock at night. They've been great.

0:44:560:44:59

With the changes to the layout, new doors have been put into some of the flats

0:44:590:45:03

and extensive soundproofing was needed, as well.

0:45:030:45:07

Remember, they paid £262,000 at auction for the property.

0:45:070:45:11

How much has the refurbishment cost?

0:45:110:45:13

We've ended up spending altogether about £85,000, which is still not too bad.

0:45:130:45:19

It's still 10,000 more than we budgeted. Not that bad. That includes all the fees as well.

0:45:190:45:23

I'm very pleased with how my money's been spent.

0:45:230:45:27

Considering what we bought the property for and the work we've done. I'm very pleased.

0:45:270:45:31

The council had agreed to pay me either 50% or 75% of the cost of

0:45:310:45:34

certain things like double glazing the kitchens, the bathroom.

0:45:340:45:40

That's now going to be 50%, as I'm not going to let it out

0:45:400:45:43

to council tenants, I'm going to let it out to private tenants.

0:45:430:45:46

That does mean that Mayur will have to find tenants himself.

0:45:460:45:49

Remember, he and Anjenna plan to move to India to give

0:45:490:45:52

their time and effort to support a charity helping local villages.

0:45:520:45:56

Time to see what two local property experts think of this conversion

0:45:590:46:02

and their chances of letting out the flats.

0:46:020:46:06

The standard of finish in the flat so far

0:46:060:46:10

is of a fairly good standard.

0:46:100:46:12

The properties are all double-glazed and centrally heated.

0:46:120:46:16

The walls have been plastered.

0:46:160:46:17

Everywhere has been rewired and re-plumbed.

0:46:170:46:20

I think the way he's created the four flats is a good thing

0:46:200:46:23

because he's now got properties he can either sell or rent.

0:46:230:46:26

He's created the top floor one-bedroomed flat, which is a small

0:46:260:46:29

flat, but he's going to get a decent income for either sale or rental.

0:46:290:46:33

I believe the space here has been maximised to its full potential.

0:46:330:46:37

Getting four flats from this property was the right thing for the current owner to do.

0:46:370:46:43

I don't like open-plan lounges and kitchens

0:46:430:46:45

but a lot of builders do that these days to maximise the space.

0:46:450:46:48

So, from a business perspective, he's done the right thing.

0:46:480:46:51

Assuming the fourth flat does get the necessary planning consent,

0:46:510:46:55

how much could the flats be worth once the work's completed?

0:46:550:46:59

Remember, they paid £262,000 at auction and Anjenna has managed

0:46:590:47:03

to keep the budget to £85,000 making a total of £347,000.

0:47:030:47:10

I believe the ground-floor flat is worth in the region of £155,000 - £160,000.

0:47:100:47:16

The first-floor flat at £155,000

0:47:160:47:21

and the same price for the second-floor flat.

0:47:210:47:25

And the small one-bed on the top floor at £115,000.

0:47:250:47:31

The ground-floor flat I believe to be worth £155,000 - £160,000.

0:47:310:47:37

The first-floor and second-floor flat, we're looking at about £150,000.

0:47:370:47:42

And the top-floor flat, between £115,000- £125,000.

0:47:420:47:47

They're good retail figures.

0:47:470:47:49

That makes the whole building worth £575,000 - £600,000. That's good.

0:47:490:47:55

Yes, very good! That valuation of £575,000 would represent

0:47:550:48:01

a pre-tax profit of about £228,000 over their total outlay of £347,000.

0:48:010:48:09

But don't forget, once the flats are rented out, the council will pay 50% of some of the costs.

0:48:090:48:15

Mayur's expecting about £10,000 for that, so the profit will be even more before the usual deductions.

0:48:150:48:22

Are they tempted to sell?

0:48:220:48:24

At the moment, I don't think so.

0:48:240:48:26

I'd rather wait for about three or four years until the prices pick up and then sell them.

0:48:260:48:31

How much could the flats generate in rent?

0:48:310:48:34

For the ground-floor flat for rental, £800-£825 per calendar month.

0:48:340:48:40

For the first floor flat, £775-£800 and the same price for the second floor flat.

0:48:400:48:48

The rental values of the properties are, for the ground floor flat, we can achieve £825 per calendar month.

0:48:480:48:55

The first floor and second floor flat, we would be looking to achieve £800 per calendar month.

0:48:550:49:00

Good. Good. That's the same figure that we had in mind.

0:49:000:49:04

Between £800 and £825 for the ground floor flat.

0:49:040:49:06

And the fourth flat?

0:49:060:49:08

For the top floor I would value this property at £625 per calendar month.

0:49:080:49:14

The top-floor flat, we would be looking to achieve £650 per calendar month.

0:49:140:49:18

We had a figure of 625, so yes.

0:49:180:49:20

We are very pleased about that as well, yes.

0:49:200:49:22

As soon as the property's rented out, Mayur and Anjenna will head off to India for eight months

0:49:220:49:28

to help the charity provide sanitation and water facilities for 51 villages.

0:49:280:49:32

So they'll be working together again.

0:49:320:49:34

Do they make a good team?

0:49:340:49:36

I think we do. We make a very good team.

0:49:360:49:40

She orders, I obey. A fantastic team. It can't go wrong.

0:49:400:49:43

The way it should be.

0:49:430:49:45

We're back in Mansfield in Nottinghamshire.

0:49:510:49:54

Steve had bought this three-bedroomed house in need of modernisation for £55,500.

0:49:540:50:00

He hadn't even seen it beforehand.

0:50:000:50:03

A self-employed electrician, he planned to renovate it himself

0:50:030:50:07

in his spare time with the help of his dad Mick and sister Samantha.

0:50:070:50:11

A family project, then. But what were they getting out of it?

0:50:110:50:16

For me it's just to see that they're all right.

0:50:160:50:18

I'll be on an hourly rate.

0:50:180:50:20

Will you? Excellent.

0:50:200:50:22

-Or a daily rate, as I said.

-Oh, really?

0:50:220:50:24

With Steve busy at work, he's left it to Dad and sister

0:50:280:50:32

to show us how the house is looking now, seven months later.

0:50:320:50:35

Ah, it seems to have taken a step or ten backwards.

0:50:360:50:41

This potential nest egg has turned into an empty shell.

0:50:410:50:45

The current state of the property is reflected in Mick and Samantha's headgear.

0:50:450:50:50

I've been involved quite a lot

0:50:500:50:52

because with Steve having to work as well

0:50:520:50:55

it's very hard to find the time to pull it in.

0:50:550:50:57

I've been doing a bit here and a bit there.

0:50:570:50:59

The kitchen was in a bit of a sorry state before, so how did they get on with that?

0:50:590:51:05

Ah, not great.

0:51:050:51:08

As you can see, this used to be the kitchen. It was in a mess,

0:51:090:51:13

but we've stripped the kitchen all out.

0:51:130:51:16

We're going to brick this window up here and take the window out and put a new window in.

0:51:160:51:23

That'll make it a bit more private.

0:51:230:51:25

The units are all lined out to go all around the room.

0:51:250:51:29

It's a nice square room, so it's a good place to put them in.

0:51:290:51:33

This wall is a bit different.

0:51:330:51:35

It was a horrible brown sort of wallpaper, which took a lot of getting off really.

0:51:350:51:40

We've took the boiler out.

0:51:400:51:42

We've got a new gas boiler already bought but not installed yet.

0:51:420:51:46

You know that saying - when you start one job, you create another?

0:51:460:51:49

This house is living proof of that.

0:51:490:51:52

Stripping the wallpaper off uncovered a damp patch, which then revealed a leaking roof.

0:51:520:51:57

That had caused some of the timber joists in the loft to rot.

0:51:570:52:00

This meant ripping down the ceiling upstairs and the easiest way

0:52:000:52:04

of getting at that ceiling was to remove the internal walls.

0:52:040:52:08

Soon you could sit in the bath and look up at the roof,

0:52:080:52:11

or you could have if the bath had still been there.

0:52:110:52:13

Will they put all those internal walls back?

0:52:130:52:16

We'll put them back in, making it a three-bedroomed house.

0:52:160:52:20

Where this wall was, it'll go back to there, which will make this room a lot bigger.

0:52:200:52:25

It'll make the boxroom a bit smaller, but big enough to get a bed in and a wardrobe, etc.

0:52:250:52:30

At the moment, the three upstairs bedrooms look more like

0:52:300:52:33

one large, open-plan bedroom with a splendid view up to the rafters.

0:52:330:52:39

But the water problems didn't stop there.

0:52:390:52:42

You could hear water leaking in the toilet,

0:52:420:52:45

we couldn't find where it was,

0:52:450:52:46

so we had to dig the concrete floor up and then we find a pipe

0:52:460:52:50

that had been broken off the tap and it was leaking there.

0:52:500:52:53

It had probably been leaking for possibly five years or more.

0:52:530:52:58

We had to trace it back and dig a hole in the garden and we found it,

0:52:580:53:03

but nicked the lead pipe and it caused water to spurt up.

0:53:030:53:07

What a nightmare!

0:53:070:53:09

The unplanned fountain in the garden meant the next-door-but-one neighbour's water supply

0:53:090:53:14

was switched off and the water board called in to do the repairs.

0:53:140:53:18

It's taken seven months to get this far, so how long now?

0:53:180:53:22

Hopefully six to seven months, I'd think.

0:53:220:53:26

The biggest problem is the roof. As you can see, it's going to be a major job to get that done.

0:53:260:53:31

That's one of the things, when we bought it,

0:53:310:53:33

we didn't realise there was a lot of water coming in.

0:53:330:53:36

That's one of the problems of not looking at the property before you buy it.

0:53:360:53:40

Buying properties unseen can be risky, not to mention expensive.

0:53:400:53:45

They originally had a budget of £12,000 to £15,000,

0:53:450:53:48

including the cost of an extension.

0:53:480:53:50

Have these problems blown a hole in that?

0:53:500:53:52

We thought it would be £12,000.

0:53:520:53:54

That was the budget we allowed for. But I'm thinking now possibly 15.

0:53:540:53:59

Hopefully it'll be under that. Because we're doing a lot of the work ourselves,

0:53:590:54:04

it should keep it down a lot.

0:54:040:54:05

Mick's son Stephen bought the property at auction for £55,500.

0:54:050:54:12

With the help of his dad and sister it's slowly being refurbished.

0:54:120:54:17

We asked two local estate agents to have a look around.

0:54:170:54:21

I'm very surprised with the extent of the modernisation on this one.

0:54:220:54:26

I did look at it in the summer of 2009

0:54:260:54:28

and I knew it was going to be a big project, but even I'm surprised

0:54:280:54:32

just how much work has been done and still has to be done to it.

0:54:320:54:36

It's a work in progress.

0:54:360:54:37

It needs a lot doing to it still.

0:54:370:54:40

The upstairs has been completely opened up

0:54:400:54:43

and needs to be re-closed and put into bedrooms again.

0:54:430:54:47

But if Steve and his family want to wave goodbye to this problem property right now,

0:54:490:54:55

would they recoup their £67,000 investment?

0:54:550:54:58

If this property were to be sold in its current state,

0:54:580:55:02

unfortunately I think the owner may have lost rather than made money on it.

0:55:020:55:06

For auction purposes we'd be looking at a guide price of £45,000 to £50,000.

0:55:060:55:11

Without an upstairs bathroom, the property isn't mortgageable.

0:55:110:55:15

And without a kitchen as well.

0:55:150:55:17

Therefore, I'd have thought that we're looking at about £50,000.

0:55:170:55:21

-That's not bad.

-That's quite good, that.

0:55:210:55:25

A positive mental attitude. Vital to success in property developing.

0:55:250:55:30

But how much could it be worth after they've completed the renovation?

0:55:300:55:33

Once renovated, I can see this property achieving in the region

0:55:330:55:37

of £85,000, perhaps suggesting an initial asking price of £89,950.

0:55:370:55:43

Once brought up to scratch, the property would go on the market at around £80,000.

0:55:430:55:47

We thought on the lines of 84, so it's in between there really.

0:55:470:55:53

-It's quite good, really.

-Yeah.

-We'd be happy at that.

0:55:530:55:58

If they stick to their budget, that could mean a pre-tax profit of

0:55:580:56:01

between £12,500 and £17,500, minus the usual deductions.

0:56:010:56:07

What about the rental market?

0:56:070:56:09

For rental purposes I can see the property

0:56:090:56:11

achieving £450 per calendar month, or perhaps even £475 per calendar month

0:56:110:56:17

if the modernisation is to a high standard.

0:56:170:56:20

For rental, I'd expect them to receive £425 per calendar month.

0:56:200:56:24

-Quite reasonable.

-I think that's quite good for this type of property.

0:56:240:56:29

So, what are Steve's plans for this house?

0:56:290:56:34

Stephen is hoping to live in it for a while, then he'll probably look for a another project.

0:56:340:56:39

This place could look amazing by the time they have all finished

0:56:390:56:42

and I'm sure Steve's hard work here will reap rewards.

0:56:420:56:45

I hope the bargain hunter in you has picked up a few tips on today's show.

0:56:480:56:52

And maybe next time it'll be you buying your home under the hammer.

0:56:520:56:55

-Looking forward to seeing you then.

-Goodbye.

-Goodbye.

0:56:550:56:58

Subtitles by Red Bee Media Ltd

0:57:050:57:08

Martin Roberts and Lucy Alexander visit a house in Southampton, a property in London and a three-bedroom end-of-terrace in Nottinghamshire. All of these properties were sold at auction; who bought them and what was paid when they went under the hammer?