0:00:02 > 0:00:04If you're like Martin and I and you absolutely love property,
0:00:04 > 0:00:08it can be difficult to switch off, even in today's market conditions.
0:00:08 > 0:00:12Whether you see your dream home on holiday, while walking round town
0:00:12 > 0:00:15or in an estate agent's window, you're never short of stimulation.
0:00:15 > 0:00:19But one place that can really get your pulse racing
0:00:19 > 0:00:20is in the auction room!
0:00:46 > 0:00:50When it comes to buying property, everyone has different requirements,
0:00:50 > 0:00:53whether it's a new home or a house you want to rent out.
0:00:53 > 0:00:55That's right. For most, location is key.
0:00:55 > 0:00:58For others, it's about the character
0:00:58 > 0:01:01and for the rest it's about how much money it can generate.
0:01:01 > 0:01:04Let's find out what inspired our buyers on today's show.
0:01:05 > 0:01:10It may not look much, but this house in Dorset is full of surprises!
0:01:10 > 0:01:14But where it gets really exciting...is there.
0:01:14 > 0:01:17I'll be on Portobello Road, London,
0:01:17 > 0:01:21to check out some groovy '70s decor.
0:01:21 > 0:01:23This harks back from that era, too.
0:01:23 > 0:01:25A serving hatch. I love that!
0:01:25 > 0:01:30And when this cottage in Newquay sold at auction in 2005,
0:01:30 > 0:01:33it wasn't everything it was cracked up to be.
0:01:33 > 0:01:35Catch up with it later to see its transformation.
0:01:37 > 0:01:39All these properties have been sold at auction.
0:01:39 > 0:01:41We find out who bought them
0:01:41 > 0:01:44and for how much, when they went under the hammer!
0:01:47 > 0:01:52I'm in historical Sherborne in Dorset. It is a lovely place.
0:01:52 > 0:01:55That is the abbey.
0:01:58 > 0:02:03Founded around AD 700, the abbey has developed from a Saxon cathedral
0:02:03 > 0:02:06into one of the most beautiful parish churches in England.
0:02:06 > 0:02:10For many, it's one of the showpiece attractions of Dorset
0:02:10 > 0:02:13and our destination of Sherborne is simply magnificent.
0:02:15 > 0:02:18Just a few minutes' walk away, this is the house.
0:02:18 > 0:02:22Three bedrooms, guide price 100,000 quid. Sounds pretty good.
0:02:23 > 0:02:26First impressions are pretty favourable, too.
0:02:26 > 0:02:30The roof looks a bit shot, and the windows need an overhaul,
0:02:30 > 0:02:33but I do love that stained glass around the door.
0:02:33 > 0:02:36The original brickwork is in a healthy state and thankfully,
0:02:36 > 0:02:38it's not been painted over.
0:02:38 > 0:02:42So this house has the makings of a very good property indeed.
0:02:45 > 0:02:48Ooh, that's a nice start. Love the floor.
0:02:48 > 0:02:50That would be beautiful.
0:02:50 > 0:02:52It'll take a bit of cleaning, but it's definitely worth doing.
0:02:52 > 0:02:54Nice entrance hall. We like that.
0:02:54 > 0:02:58Interesting new balustrade. Bit unusual.
0:02:58 > 0:03:02But that's more original. Floorboards to die for. Fantastic.
0:03:02 > 0:03:05And an old original fireplace which is pretty.
0:03:05 > 0:03:08That's the front sitting room. Rear sitting room there.
0:03:08 > 0:03:11New plaster, which is good to see.
0:03:11 > 0:03:13Floorboards in great condition.
0:03:13 > 0:03:17So all looking good. What is really nice is lots of original features
0:03:17 > 0:03:19like these doors. The original doors.
0:03:19 > 0:03:22Somebody's stripped them back, though.
0:03:22 > 0:03:25They fit perfectly, so that is good to see.
0:03:25 > 0:03:29Through to the kitchen. Not massive in size.
0:03:29 > 0:03:33I think you could do something with it, with a bit of imagination.
0:03:33 > 0:03:35Again, I don't know quite what's going on here.
0:03:35 > 0:03:39There's paint, looks like it's been recently used paint,
0:03:39 > 0:03:42all over the place. And new windows.
0:03:44 > 0:03:46I need to investigate this a bit more.
0:03:46 > 0:03:50Now, I'm visiting the property a few weeks after the auction
0:03:50 > 0:03:52you'll see in a moment.
0:03:52 > 0:03:57It turns out that the new owners had to do a considerable amount of work
0:03:57 > 0:04:01after they'd won the bidding, but before they could get a mortgage.
0:04:01 > 0:04:05At least that means it's now in a better state for me to take a look.
0:04:06 > 0:04:11Upstairs, a really nice feel to this house. Intrinsically nice.
0:04:11 > 0:04:15Bathroom and loo there, exactly where it should be.
0:04:15 > 0:04:18Then three decent-sized bedrooms.
0:04:18 > 0:04:22But where it gets really exciting...is there.
0:04:22 > 0:04:26Yep, it's just a loft hatch, but I can see, looking up there,
0:04:26 > 0:04:30that there's enough headroom to make another room, another bedroom,
0:04:30 > 0:04:33to turn this into a four-bedroomed house.
0:04:33 > 0:04:37That's what some other houses in this street have done.
0:04:37 > 0:04:40One of those was recently on the market for 260,000 quid.
0:04:40 > 0:04:46So, bearing in mind the guide price of this place was just 100,000...
0:04:47 > 0:04:50..I think it's worth considering. Don't you?
0:04:50 > 0:04:53Well, that's a potential margin you don't see every day.
0:04:53 > 0:04:55Maybe that's why the new buyers
0:04:55 > 0:04:59were so keen to meet the mortgage requirements to get the property.
0:04:59 > 0:05:03With gorgeous floorboards, fireplaces and sash windows,
0:05:03 > 0:05:05this place looks like a winner.
0:05:05 > 0:05:09And it's just a short walk away from all that Sherborne has to offer.
0:05:09 > 0:05:13At the rear of the property here, not a huge amount of space
0:05:13 > 0:05:15but quite a useable area.
0:05:15 > 0:05:19At the moment, though, dominated completely by these two sheds.
0:05:19 > 0:05:21So what are your options?
0:05:21 > 0:05:26One, you could knock them down to create maybe a little courtyard
0:05:26 > 0:05:28and maybe a garden of some sort.
0:05:28 > 0:05:32However, I'm a big fan of sheds. You can never have too much storage.
0:05:32 > 0:05:36Personally, I would tart them up and keep them.
0:05:37 > 0:05:39Trust me!
0:05:39 > 0:05:41Yes, I confess to being a bit of a hoarder.
0:05:41 > 0:05:44So any storage is always important to me.
0:05:44 > 0:05:48But if you prefer outside space, you can always pull them down.
0:05:48 > 0:05:51Time to see what a local estate agent will make
0:05:51 > 0:05:54of this highly attractive period house.
0:05:54 > 0:05:56It's in a very sought-after location
0:05:56 > 0:05:58and was guided at £100,000.
0:06:02 > 0:06:05It's a lovely house. Potentially, it's all here.
0:06:05 > 0:06:08It's a Victorian semi-detached house,
0:06:08 > 0:06:10a stone's-throw from the town centre.
0:06:10 > 0:06:13Although it needs a lot of work,
0:06:13 > 0:06:15potentially it's a very nice property.
0:06:17 > 0:06:19My only reservation is the size.
0:06:19 > 0:06:23It's a bit small, but it has a lot of space that could be converted
0:06:23 > 0:06:24if it was worth it.
0:06:25 > 0:06:29It doesn't normally increase the value of the property
0:06:29 > 0:06:30by a great deal.
0:06:30 > 0:06:33So it would be very much a personal choice
0:06:33 > 0:06:37rather than actually increasing the value of the property.
0:06:37 > 0:06:41True, because it would be possible to reconfigure the layout here
0:06:41 > 0:06:43to maximise the space, so there are options.
0:06:44 > 0:06:46What I would do is turn
0:06:46 > 0:06:49one of the downstairs reception rooms into a kitchen.
0:06:49 > 0:06:52And the small room at the back
0:06:52 > 0:06:56I would turn into a utility room-cum-downstairs loo.
0:06:56 > 0:06:59You don't have a loo, at the moment, downstairs.
0:06:59 > 0:07:02But I would keep, basically, the rooms very much as they are
0:07:02 > 0:07:05because it's a nicely-proportioned Victorian house.
0:07:05 > 0:07:09Let's talk figures. How much could someone stand to make here?
0:07:09 > 0:07:11I would have thought the price,
0:07:11 > 0:07:14when renovated, if done to a high standard,
0:07:14 > 0:07:18would be somewhere in the region of 210 to 220,000.
0:07:18 > 0:07:20The rental for this property
0:07:20 > 0:07:23per calendar month would be about 650 to £700.
0:07:23 > 0:07:25Well, great location, good house.
0:07:25 > 0:07:29Potential to expand. What more do you want? A great one to go for.
0:07:29 > 0:07:32Let's see who spotted it when it went to auction.
0:07:33 > 0:07:36Lucerne. Three bedrooms.
0:07:36 > 0:07:38It's a super buy. Guide £100,000.
0:07:38 > 0:07:42I do have a proxy bid which I'll execute from the rostrum
0:07:42 > 0:07:45so that it's quite clear that it's my bid.
0:07:45 > 0:07:48I'm starting the bidding at £80,000.
0:07:48 > 0:07:50At 80,000, ladies and gentlemen, it's my bid.
0:07:50 > 0:07:53Looking for 85. At 85.
0:07:53 > 0:07:5590 is my bid. At 90.
0:07:55 > 0:07:5695.
0:07:56 > 0:07:59And 100 is the proxy bid. At 100.
0:07:59 > 0:08:01At 105.
0:08:01 > 0:08:03At 105. Anyone else?
0:08:03 > 0:08:04110 on my left.
0:08:04 > 0:08:06110. 115.
0:08:06 > 0:08:10120. 120. 125.
0:08:10 > 0:08:12125. I'm out, ladies and gentlemen.
0:08:12 > 0:08:13125. Lady's bid.
0:08:13 > 0:08:15At 125.
0:08:15 > 0:08:17125. I'll take two if it helps you.
0:08:17 > 0:08:20127. 127. 130.
0:08:20 > 0:08:23132. 135.
0:08:23 > 0:08:27135. Lady in black at 135.
0:08:27 > 0:08:31135,000. Are you all done, ladies and gentlemen?
0:08:31 > 0:08:34136. 137.
0:08:34 > 0:08:38137. 137 standing. 137.
0:08:38 > 0:08:39138.
0:08:39 > 0:08:43139. 139.
0:08:43 > 0:08:46140. 140. 141?
0:08:46 > 0:08:50At 141,000, then, standing straight in front of me.
0:08:50 > 0:08:52Are you all done, ladies and gentlemen?
0:08:52 > 0:08:56Lady's bid. Straight there. 141.
0:08:56 > 0:08:58Congratulations. Well done, you.
0:08:58 > 0:09:01That winning bid of 141,000 was made by Linda,
0:09:01 > 0:09:04a local housing association manager.
0:09:07 > 0:09:09Originally from South Wales,
0:09:09 > 0:09:1220 years ago she visited friends in Dorset,
0:09:12 > 0:09:16fell in love with the place and made this part of the world her home.
0:09:16 > 0:09:19I went to the property to meet Linda and find out about her plans.
0:09:21 > 0:09:25- Linda, lovely to meet you. Congratulations.- Thank you.
0:09:25 > 0:09:29- Nice house.- Yep.- Yeah. Why did you want to buy it?
0:09:29 > 0:09:33I like the location. And the house has good development potential,
0:09:33 > 0:09:35I thought. I really like it.
0:09:35 > 0:09:39- Have you done anything like this before?- I've done work on properties
0:09:39 > 0:09:43I've lived in, but not taken on a property just to develop.
0:09:43 > 0:09:46So it's a first opportunity, really.
0:09:46 > 0:09:48I'm doing it with my partner, who's a carpenter, so...
0:09:48 > 0:09:52- That's useful.- We'll be doing a lot of work ourselves.
0:09:52 > 0:09:57Don't forget, they've already had to do work to get a mortgage.
0:09:57 > 0:10:01We've rewired it, we've had a specialist's report on damp,
0:10:01 > 0:10:03dry rot, for mortgage purposes.
0:10:03 > 0:10:07- Before you bought it or after?- After we bought it, before completion.
0:10:07 > 0:10:10We had to sign a building licence to do that.
0:10:10 > 0:10:12You bought it at auction, the hammer went down.
0:10:12 > 0:10:14You've exchanged contracts.
0:10:14 > 0:10:19In between that time and completion,
0:10:19 > 0:10:22- paying the rest of the money, you had to do all the work?- Yep.
0:10:22 > 0:10:24But if you hadn't completed...
0:10:24 > 0:10:26We were going to make sure it completed!
0:10:26 > 0:10:29But if it hadn't completed, you'd have done all this work...
0:10:29 > 0:10:32- And lost the money. - The deposit and all the work.
0:10:32 > 0:10:34The mortgage company we went to,
0:10:34 > 0:10:37they stipulated before the auction there were a couple of things to do,
0:10:37 > 0:10:42but when we'd completed that, they re-inspected and said,
0:10:42 > 0:10:45"We're not satisfied. We need more work done."
0:10:45 > 0:10:47So there were two days solid
0:10:47 > 0:10:50with eight of us in here just making it habitable.
0:10:50 > 0:10:53There were no windows in this room and upstairs.
0:10:53 > 0:10:56They wanted windows in the back of the property.
0:10:56 > 0:11:00- They wanted a lick of paint around...- What?!- Yep!
0:11:00 > 0:11:05Plaster. We plastered that wall there and most of this room.
0:11:05 > 0:11:10- We're going to rip it all down, so it was a waste of money!- What?
0:11:10 > 0:11:12- Yep.- You're going to rip it all down?
0:11:12 > 0:11:16Because our plans are to knock those two rooms into one
0:11:16 > 0:11:19and put French doors in, so it was a waste of money.
0:11:19 > 0:11:24How much did it cost to do the work that you had to do for the mortgage?
0:11:24 > 0:11:27About 5,500. That's not all wasted
0:11:27 > 0:11:30because we had to have the electrics done
0:11:30 > 0:11:34and the specialists' report, the damp and dry rot treatment.
0:11:34 > 0:11:36We've probably wasted £1,000 of that.
0:11:36 > 0:11:39Bearing in mind the fact your partner is a carpenter,
0:11:39 > 0:11:43presumably for anybody else, it could have cost a lot more.
0:11:43 > 0:11:44It could have been.
0:11:44 > 0:11:47If we hadn't been in that position with friends in the trade
0:11:47 > 0:11:49and Simon being a carpenter,
0:11:49 > 0:11:51then we would never have done it.
0:11:51 > 0:11:54Now all that's over, the renovation can begin.
0:11:54 > 0:11:58They intend to go up into the loft to gain an extra bedroom.
0:11:58 > 0:12:01On the ground floor, they'll demolish the wall
0:12:01 > 0:12:03between the two sitting rooms.
0:12:03 > 0:12:06How much will it cost to do the works from this point on?
0:12:06 > 0:12:11- What's your budget?- Our budget was 30,000 including the money
0:12:11 > 0:12:13we've already spent.
0:12:13 > 0:12:16- What kind of timescale?- Six months.
0:12:16 > 0:12:19A baptism of fire for first-timer Linda, then.
0:12:19 > 0:12:23But she's got Simon and plenty of building friends to lend a hand.
0:12:24 > 0:12:28So, a real cautionary tale, here,
0:12:28 > 0:12:32and an indication of the state of the mortgage market at the moment!
0:12:32 > 0:12:35All that work they had to do, some of which they will take out,
0:12:35 > 0:12:38just to get the mortgage. And you know what?
0:12:38 > 0:12:41If they hadn't done it, they'd have lost their deposit and the money
0:12:41 > 0:12:43they spent sorting it out.
0:12:43 > 0:12:46Blimey! Anyway, having spent that money,
0:12:46 > 0:12:48they now have to get on with restoring the place.
0:12:48 > 0:12:51Is it turning into a money pit before they've even started?
0:12:51 > 0:12:53I like what they're planning.
0:12:53 > 0:12:56Let's see how it progresses later in the show.
0:12:58 > 0:13:01# Getting hung up all day on smiles
0:13:01 > 0:13:04# Walking down Portobello Road for miles... #
0:13:06 > 0:13:10I'm on Portobello Road, famed for its wonderful Saturday market,
0:13:10 > 0:13:14jam-packed with antiques, crafts and tourists.
0:13:14 > 0:13:16The area was developed by the Victorians
0:13:16 > 0:13:18who built beautiful grand squares.
0:13:18 > 0:13:20But anybody visiting in the 1970's
0:13:20 > 0:13:23would have found it an edgy London suburb,
0:13:23 > 0:13:26rough and gritty with an exciting vibe.
0:13:26 > 0:13:29Today, you have to have more than grit to live here -
0:13:29 > 0:13:32you have to have buckets and buckets of cash!
0:13:34 > 0:13:36It was Portobello Road's starring role
0:13:36 > 0:13:38alongside Hugh Grant and Julia Roberts
0:13:38 > 0:13:43in the film Notting Hill that sealed this area's reputation
0:13:43 > 0:13:46as a glamorous and fashionable place to live and hang out.
0:13:47 > 0:13:50The property I'm here to see is something of a gem.
0:13:50 > 0:13:51It's in this row
0:13:51 > 0:13:54of brightly coloured Victorian workmen's cottages
0:13:54 > 0:13:56and it's right on Portobello itself.
0:13:56 > 0:13:57I can't stress enough
0:13:57 > 0:14:00how sought-after and desirable this area is.
0:14:00 > 0:14:04To find a house up for auction is a find indeed.
0:14:04 > 0:14:09Here it is, pretty in pink, and with a stunning guide price to match.
0:14:09 > 0:14:13700,000 for a two-bedroomed mid-terrace!
0:14:13 > 0:14:15I did warn you!
0:14:15 > 0:14:17I'm going to go inside and hope we strike gold.
0:14:17 > 0:14:22Yes, you heard it right. Just two bedrooms for £700,000!
0:14:22 > 0:14:27But this is London and very desirable Notting Hill.
0:14:33 > 0:14:37The good thing is, you've got this entrance lobby here.
0:14:37 > 0:14:40It's always handy to bung your umbrella and dirty boots there.
0:14:40 > 0:14:44But my first impressions are it's really big inside.
0:14:44 > 0:14:47It's certainly quite deceptive.
0:14:47 > 0:14:49You've got wonderful high ceilings.
0:14:49 > 0:14:53There's lots of intricate plasterwork and cornicing.
0:14:53 > 0:14:55I know it's not original to the building.
0:14:55 > 0:14:59I'd get rid of a lot of this. It's far too fussy.
0:14:59 > 0:15:02I think it was probably renovated in the '70s.
0:15:02 > 0:15:06The floors are not bad. If you sanded those up and re-stained them,
0:15:06 > 0:15:07they could look quite nice.
0:15:07 > 0:15:12The wall here has been knocked through to create this double space.
0:15:12 > 0:15:14It does have an old-fashioned feel about it,
0:15:14 > 0:15:17but I quite like this house.
0:15:17 > 0:15:20Maybe it's because I'm a child of the '70s,
0:15:20 > 0:15:23but this house really sparkles for me.
0:15:23 > 0:15:27Unfortunately, not everything in the house is as sparkling -
0:15:27 > 0:15:28namely that kitchen!
0:15:28 > 0:15:32Ooh, now that's a disappointing kitchen.
0:15:32 > 0:15:34Very brown and fern green everywhere.
0:15:34 > 0:15:37Incredibly '70s.
0:15:37 > 0:15:40And look at this. This harks back from that era, too.
0:15:40 > 0:15:42A serving hatch. I love that!
0:15:47 > 0:15:48In the '70s,
0:15:48 > 0:15:52I bet that serving hatch was a great way to pass a fondue set
0:15:52 > 0:15:55from the kitchen downstairs to the dining room upstairs
0:15:55 > 0:15:57for dinner parties.
0:15:57 > 0:16:00But I think this place needs a more modern look now.
0:16:01 > 0:16:05I really see a lovely big extension here,
0:16:05 > 0:16:10with a glass roof and going out onto that bit of outside space,
0:16:10 > 0:16:13to really open this kitchen up.
0:16:13 > 0:16:16I know I'm always going on about valuable outside space in London.
0:16:16 > 0:16:18But this kitchen is just too small.
0:16:18 > 0:16:21It would really benefit from having a big open space here,
0:16:21 > 0:16:23lots of light coming in.
0:16:23 > 0:16:27Imagine, you could entertain friends, have dinner parties.
0:16:27 > 0:16:31This house, in this area, needs a good kitchen.
0:16:31 > 0:16:36Talking of space, the stairwells in this property may look narrow
0:16:36 > 0:16:39but they lead up to two good-sized bedrooms.
0:16:39 > 0:16:42Again, the decor is hardly trendy London,
0:16:42 > 0:16:45and could do with being more contemporary.
0:16:45 > 0:16:48As for that bathroom suite, well, I'm hardly tickled pink!
0:16:48 > 0:16:51But if it's hard to relax in that garish bathroom,
0:16:51 > 0:16:54I've found a chilled-out haven at the top of the house.
0:16:56 > 0:17:02- #- I climb way up to the top of the stairs
0:17:02 > 0:17:09# And all my cares just drift right into space... #
0:17:12 > 0:17:15It's a lovely sunny day, the market's in full swing,
0:17:15 > 0:17:19you want to escape the hustle and bustle with your newspaper
0:17:19 > 0:17:20and glass of wine.
0:17:20 > 0:17:24Where do you go? That's right, your own private roof terrace, of course!
0:17:24 > 0:17:28Doesn't get much better than this, you know.
0:17:28 > 0:17:31# On the roof it's peaceful
0:17:31 > 0:17:34# As can be... #
0:17:34 > 0:17:37It really does feel peaceful up here.
0:17:37 > 0:17:40Calm, quiet and secret.
0:17:40 > 0:17:43A peek over the railings into next door's yard
0:17:43 > 0:17:47shows that they've already extended the kitchen, so that settles it.
0:17:47 > 0:17:49Since you've got this terrace,
0:17:49 > 0:17:52you could sacrifice that square of garden down there
0:17:52 > 0:17:57but it does mean spending more, and this property is already expensive.
0:17:57 > 0:18:00OK, so 700 guide is a lot of money.
0:18:00 > 0:18:04But would it shock you to hear that properties like this have been known
0:18:04 > 0:18:07to go for double! Yes, that's 1.4 million!
0:18:07 > 0:18:11There's a lot of work to do to bring it up to that standard.
0:18:11 > 0:18:15The financial climate has tightened even the richest Londoners' wallets.
0:18:15 > 0:18:18But this location is second to none.
0:18:18 > 0:18:23I could even say that investing here really is as safe as houses.
0:18:24 > 0:18:29Just to make sure, I asked a local estate agent what he thought
0:18:29 > 0:18:31of the house's potential.
0:18:33 > 0:18:35To realise the highest price in resale,
0:18:35 > 0:18:38you'd probably flip the property completely.
0:18:38 > 0:18:42You'd attempt to get a Mansard conversion,
0:18:42 > 0:18:45ie, add an additional floor,
0:18:45 > 0:18:49Put the kitchen up there, have that gallerying over the reception space
0:18:49 > 0:18:54on the first floor and then get two, possibly three bedrooms out of the
0:18:54 > 0:18:56ground floor accommodation.
0:18:59 > 0:19:02A third bedroom may have its downside, as it would make
0:19:02 > 0:19:04the two existing bedrooms smaller.
0:19:04 > 0:19:08How much could this property be worth, once renovated?
0:19:08 > 0:19:10Resale values are topping out at the moment
0:19:10 > 0:19:14at around 1,300 to £1,350 per square foot.
0:19:14 > 0:19:19Which would bring us up to a resale value of around 1.35 to 1.45,
0:19:19 > 0:19:21assuming we were able to extend.
0:19:21 > 0:19:27That's 1.35 to 1.45 million!
0:19:27 > 0:19:32So if it did sell for around its guide price of 700,000,
0:19:32 > 0:19:34you'd still be quids in, even after
0:19:34 > 0:19:38the several hundred thousand you'd need to spend on renovations.
0:19:38 > 0:19:40Would it be worth considering rental?
0:19:41 > 0:19:44Depending on the specification and the finish,
0:19:44 > 0:19:48we'd take it right up to being worth 1.25 to 1.3 million,
0:19:48 > 0:19:51we'd expect to get 1,250 to 1,300 a week.
0:19:53 > 0:19:54Walk down here on a Saturday
0:19:54 > 0:19:59and you'll find tourists taking pictures of these houses
0:19:59 > 0:20:01and dreaming of the day when maybe
0:20:01 > 0:20:03they would be able to live in such a place.
0:20:03 > 0:20:07This is a lovely home in an exceptional location.
0:20:07 > 0:20:09The guide price is almost irrelevant.
0:20:09 > 0:20:13It's an opportunity as much as it is an investment.
0:20:13 > 0:20:16They don't come along like this very often.
0:20:16 > 0:20:18Let's see who went for it at the auction.
0:20:20 > 0:20:24Bidding was keen for this one. It started at the £700,000 guide price
0:20:24 > 0:20:29and soared upwards in steps of just five grand.
0:20:29 > 0:20:31800. 805.
0:20:31 > 0:20:33810. 815.
0:20:33 > 0:20:36820. 825.
0:20:36 > 0:20:37830.
0:20:37 > 0:20:39835.
0:20:39 > 0:20:42And still the bidding goes on.
0:20:42 > 0:20:44At five grand a time.
0:20:44 > 0:20:46We could be here all day!
0:20:46 > 0:20:47Let's come back later.
0:20:49 > 0:20:52945 in the aisle. 945.
0:20:52 > 0:20:53950.
0:20:53 > 0:20:55950.
0:20:55 > 0:20:57955.
0:20:57 > 0:20:59Make up your mind. If not...
0:20:59 > 0:21:01955.
0:21:01 > 0:21:02960.
0:21:03 > 0:21:05965.
0:21:07 > 0:21:08965.
0:21:08 > 0:21:10970.
0:21:11 > 0:21:12975?
0:21:14 > 0:21:17970 on my left.
0:21:17 > 0:21:20First time. Second time.
0:21:20 > 0:21:22975. 980?
0:21:22 > 0:21:24Yes? 985?
0:21:24 > 0:21:27It's either yes or no. 985.
0:21:28 > 0:21:30980. First time.
0:21:30 > 0:21:34Second time. Third and last time. Have you all done?
0:21:34 > 0:21:37Sold at 980. Well bid. You got there.
0:21:37 > 0:21:41Eventually, the successful bid came from Simon.
0:21:41 > 0:21:43He's local to West London
0:21:43 > 0:21:45and has been in the property business for 20 years,
0:21:45 > 0:21:49building up a portfolio of 15 properties.
0:21:50 > 0:21:53He paid 980,000 for the house,
0:21:53 > 0:21:56a hefty £280,000 over the guide price.
0:21:56 > 0:21:59So he must really have wanted it.
0:21:59 > 0:22:02I met him there to find out why.
0:22:04 > 0:22:07Simon, congratulations. You've got a great house here.
0:22:07 > 0:22:09Why did you want to buy it?
0:22:09 > 0:22:13Thanks, Lucy. It is such a lovely road, Portobello Road.
0:22:13 > 0:22:15It comes up so infrequently.
0:22:15 > 0:22:18And I thought I had to go for it,
0:22:18 > 0:22:20and I did - and here I am!
0:22:20 > 0:22:23You really wanted this, didn't you?
0:22:23 > 0:22:27I did want it, yeah. I felt that there is a profit in here.
0:22:27 > 0:22:30With the right development done
0:22:30 > 0:22:35I think in a couple of years it will make more money. A lot more money.
0:22:35 > 0:22:40Simon is right. This is such a great opportunity in one of London's
0:22:40 > 0:22:41most desirable areas.
0:22:41 > 0:22:46What are his renovation plans to maximise the potential profit here?
0:22:49 > 0:22:54In a nutshell, to build a new bedroom on the roof. A new bathroom.
0:22:54 > 0:22:58Totally refurbish the kitchen, new electrics, new plumbing.
0:22:58 > 0:23:01A new conservatory at the back
0:23:01 > 0:23:03to incorporate the yard area.
0:23:03 > 0:23:06And it will provide a new dining room area and kitchen.
0:23:06 > 0:23:08All very modern.
0:23:08 > 0:23:11I do have to get planning for the roof extension,
0:23:11 > 0:23:15but as there are two or three already existing
0:23:15 > 0:23:19and we have an established use on the roof terrace at the moment,
0:23:19 > 0:23:22I think we'll be lucky and I think we'll get that.
0:23:22 > 0:23:26I think that will provide the key to the profit in this property.
0:23:26 > 0:23:28That extra bedroom.
0:23:28 > 0:23:32But it's quite a lot of expenditure just for one small bedroom.
0:23:32 > 0:23:33It's not going to be that big.
0:23:33 > 0:23:36In my opinion, as a lowly developer,
0:23:36 > 0:23:40I do know what the tenants' requirements are.
0:23:40 > 0:23:45Three bedrooms will make it much more easily lettable.
0:23:45 > 0:23:49It will open that door slightly.
0:23:49 > 0:23:52And to help Simon open that door,
0:23:52 > 0:23:55who better than his trusty builder, Mark,
0:23:55 > 0:23:58but known to many as The Commander!
0:24:00 > 0:24:03So I rendezvoused with him up on the battlements,
0:24:03 > 0:24:05to hear his attack plan!
0:24:07 > 0:24:10Mark, you're not the usual typical builder
0:24:10 > 0:24:12that I meet every day on building sites!
0:24:12 > 0:24:15No, I don't do "usual". I do unusual.
0:24:15 > 0:24:18Would you say this is going to be unusual?
0:24:18 > 0:24:20I've known Simon for 30 years,
0:24:20 > 0:24:23so no, we're going to make some money out of this place.
0:24:23 > 0:24:25- Are you?- Absolutely.
0:24:25 > 0:24:28Tell me, how will you get a third bedroom in here?
0:24:28 > 0:24:29This roof here will be mansard
0:24:29 > 0:24:33so basically we've got to raise the height of the whole thing
0:24:33 > 0:24:37and put possibly two dormer windows here, a Velux at the front.
0:24:37 > 0:24:42That will allow us to hopefully get the extra bathroom, extra bedroom.
0:24:42 > 0:24:46And then downstairs,
0:24:46 > 0:24:50all the drainage has got to be changed,
0:24:50 > 0:24:52a conservatory, knock through the kitchen,
0:24:52 > 0:24:56possibly rearrange the living room, I don't know. We'll see as we go.
0:24:56 > 0:24:59Tell me, Mark, what would you price this job at?
0:25:00 > 0:25:05The project cost I'd estimate about 64,000.
0:25:05 > 0:25:07- For all of that work?- Yeah.
0:25:07 > 0:25:11- Yeah.- Sounds quite cheap to me. - That's why I'm a busy builder!
0:25:11 > 0:25:15I'd be extremely surprised if all this could be done for 64,000,
0:25:15 > 0:25:18and if they'd even get the planning permission.
0:25:18 > 0:25:19It's a massive job
0:25:19 > 0:25:24and Simon assures me they won't be scrimping on style or quality.
0:25:24 > 0:25:26He's set aside up to £100,000,
0:25:26 > 0:25:29but I wonder how much of that he'll have left?
0:25:29 > 0:25:32Simon and the Commander seem pretty confident
0:25:32 > 0:25:35and hopefully there won't be any nasty surprises
0:25:35 > 0:25:38to cause costs to spiral out of control.
0:25:38 > 0:25:40Talking of surprises,
0:25:40 > 0:25:42I had one for Simon.
0:25:42 > 0:25:47Simon, did you know that you've got access to Ladbroke Square Gardens?
0:25:47 > 0:25:48We have the key to that, do we?
0:25:48 > 0:25:52I'm telling you that with this property you can use the gardens!
0:25:52 > 0:25:56Right. Because I've just had a phone call from Savill's, the auctioneers,
0:25:56 > 0:25:58saying they have another bundle of keys.
0:25:58 > 0:26:01Which I wasn't aware of. I'm going to pick them up.
0:26:01 > 0:26:04That's brilliant news for me!
0:26:04 > 0:26:06- Great! Fantastic! - How happy are you now?
0:26:06 > 0:26:09I think you've just put 50 grand on the price.
0:26:09 > 0:26:13The reason he's so excited is that Ladbroke Square Gardens
0:26:13 > 0:26:17is one of the largest and most exclusive private gardens in London.
0:26:17 > 0:26:19There's even a tennis court.
0:26:19 > 0:26:22But he will have to pay an annual fee to get a key.
0:26:22 > 0:26:25Even at nearly one million pounds,
0:26:25 > 0:26:27I think Simon has got a great buy.
0:26:27 > 0:26:30He's a confident character, he knows his turf.
0:26:30 > 0:26:32But getting planning permission
0:26:32 > 0:26:34for that third bedroom may not be a dead cert.
0:26:34 > 0:26:37Find out how he gets on later in the show.
0:26:38 > 0:26:42Coming up, this cottage in Newquay was sold at auction in 2005,
0:26:42 > 0:26:44in need of major structural repair.
0:26:44 > 0:26:47Later, we'll show you the amazing finished result.
0:26:48 > 0:26:52Back in London, has that extension caused problems?
0:26:52 > 0:26:56You might upset the neighbours, you might upset the conservation people,
0:26:56 > 0:26:59or upset Fred Bloggs down the road.
0:27:01 > 0:27:04First, we're back in Dorset to see how the buyer of this house
0:27:04 > 0:27:07got on with the renovations.
0:27:10 > 0:27:14We're returning to the beautiful Dorset town of Sherborne
0:27:14 > 0:27:19where Linda paid 141,000 quid for this three-bed end-of-terrace.
0:27:19 > 0:27:22Her partner, Simon, is a carpenter.
0:27:22 > 0:27:25They intended to renovate it, add a loft conversion,
0:27:25 > 0:27:28then either sell or rent it out, depending on the market.
0:27:28 > 0:27:30But to satisfy the mortgage company,
0:27:30 > 0:27:34they had to do a lot of work before they could complete the purchase.
0:27:34 > 0:27:37They wanted windows in the back of the property,
0:27:37 > 0:27:41- they wanted a lick of paint around. - What?!- Yep.
0:27:41 > 0:27:44Plaster. We plastered that wall
0:27:44 > 0:27:48there, and most of this room only to rip it all down again!
0:27:48 > 0:27:51Four and a half months later, we're back.
0:27:51 > 0:27:54The main structural work is finished.
0:27:56 > 0:27:59On the ground floor, the wall dividing the two living rooms
0:27:59 > 0:28:03has been removed, creating a large, open space.
0:28:03 > 0:28:06Once decorated, this will be a perfect through room
0:28:06 > 0:28:08leading to the refitted kitchen.
0:28:16 > 0:28:19Outside, I'm afraid they didn't follow my advice
0:28:19 > 0:28:21to keep some storage space.
0:28:21 > 0:28:23Those two sheds were both demolished
0:28:23 > 0:28:26but a lovely courtyard has been created.
0:28:27 > 0:28:30However, I can't see any sign of that loft conversion.
0:28:30 > 0:28:33Did Simon and Linda have a change of plan?
0:28:36 > 0:28:37We decided against the loft.
0:28:37 > 0:28:40We weighed things up and spoke to people about it.
0:28:40 > 0:28:43It was the time it was going to take.
0:28:43 > 0:28:45Add another couple of months on
0:28:45 > 0:28:49to the work for not much financial benefit.
0:28:49 > 0:28:51They had originally planned to do
0:28:51 > 0:28:55the work, including the loft, in about six months.
0:28:55 > 0:28:57So, without that, how long had it taken?
0:28:59 > 0:29:03After we'd sorted it out and paid for it, and the stuff we did
0:29:03 > 0:29:06for the mortgage people, it was about five and a half months.
0:29:06 > 0:29:09- Yeah.- We thought it would have been quicker,
0:29:09 > 0:29:14but I found the bathroom took me longer than I expected.
0:29:14 > 0:29:17Simon is a skilled carpenter,
0:29:17 > 0:29:20so the doors, skirting boards and stairs were no problem.
0:29:20 > 0:29:26But tiling was a challenge he took on in the kitchen and bathroom.
0:29:26 > 0:29:28This is the bathroom.
0:29:28 > 0:29:31It was probably the hardest room for me to do, really.
0:29:31 > 0:29:35I wanted to create quite a stunning look to it.
0:29:35 > 0:29:39It's the first time I've ever tiled, so it was a bit of an experience!
0:29:39 > 0:29:44We were lucky that the bath suite was on a half-price offer in town.
0:29:44 > 0:29:46We were lucky with that.
0:29:46 > 0:29:49I wanted really clean lines, no knobs or anything on here.
0:29:49 > 0:29:52So we've got touch catches.
0:29:52 > 0:29:55I'm really pleased with it.
0:29:55 > 0:29:58It's everything I thought it was going to be, really.
0:29:58 > 0:30:01I'm not surprised. It's an impressive result
0:30:01 > 0:30:04so now Simon can add tiling to his CV.
0:30:04 > 0:30:08I'm sure plenty of muscle and skip loading was needed to clear
0:30:08 > 0:30:10the sheds in the back yard.
0:30:12 > 0:30:14It's a big transformation out here.
0:30:14 > 0:30:17We've knocked through and put the French doors in
0:30:17 > 0:30:20to let the light through the building and open it up.
0:30:20 > 0:30:22It's a nice sun trap out here,
0:30:22 > 0:30:26so we wanted to knock down the buildings and open it up.
0:30:26 > 0:30:29It's created quite a big space now.
0:30:29 > 0:30:32I'm really, really pleased with this.
0:30:32 > 0:30:35Both Linda and Simon have worked really hard here.
0:30:35 > 0:30:38And got lucky with a bargain on that bathroom suite.
0:30:38 > 0:30:40How much have they had to spend
0:30:40 > 0:30:43on top of the 141,000 they paid on auction day?
0:30:44 > 0:30:49In terms of budget, I think we've spent 26,000, plus legal fees.
0:30:49 > 0:30:52Probably 27,500 all together.
0:30:52 > 0:30:57That brings their total gross outlay to £168,500.
0:30:57 > 0:31:01But will they see any financial return?
0:31:03 > 0:31:08Time for two estate agents to give their expert opinion on the house
0:31:08 > 0:31:11and advise on its current value.
0:31:11 > 0:31:15I think the standard of finish in this property is superb.
0:31:15 > 0:31:17They've paid a lot of attention to detail.
0:31:17 > 0:31:21It's very good quality and you can tell they've spent
0:31:21 > 0:31:24a lot of time and trouble getting it right.
0:31:24 > 0:31:29What I like about this property is they've kept the character features
0:31:29 > 0:31:31within the internal structure,
0:31:31 > 0:31:35so beautiful fireplaces, but put the contemporary kitchen in
0:31:35 > 0:31:38and bathroom, which really complements it nicely.
0:31:38 > 0:31:41Linda and Simon are looking to sell,
0:31:41 > 0:31:44but would consider renting the property short term
0:31:44 > 0:31:46if the resale figures didn't add up.
0:31:46 > 0:31:48So how much rental could they generate?
0:31:48 > 0:31:52I would estimate the rental value of this property
0:31:52 > 0:31:54at £675 per calendar month.
0:31:54 > 0:31:56The value I'd put on this property
0:31:56 > 0:32:01for rental would be about 850 to £900 per calendar month.
0:32:01 > 0:32:03- Crikey! That's good!- Yeah!
0:32:03 > 0:32:06Not that we're really thinking of renting.
0:32:06 > 0:32:08But it's nice to know.
0:32:08 > 0:32:12Let's see how much the house could achieve if it was put on the market.
0:32:12 > 0:32:18Remember, it's got to be more than 168,500 to see any profit.
0:32:20 > 0:32:24The value I'd put on this property for resale purposes today
0:32:24 > 0:32:26would be round about £250,000.
0:32:26 > 0:32:32I would value this property based on the open market price of £250,000.
0:32:32 > 0:32:35Crikey! If they sold for that,
0:32:35 > 0:32:39they'd see a pre-tax profit of around 81 and a half grand!
0:32:41 > 0:32:43Pleased with that!
0:32:43 > 0:32:44Yeah!
0:32:44 > 0:32:48- That's, um...- A lot more than we thought.- Yeah.
0:32:48 > 0:32:51We were expecting 215, 220 maybe.
0:32:51 > 0:32:55- But that's...- Brilliant. - ..totally different. Yeah.
0:32:55 > 0:32:57- Great.- Really pleased.
0:32:58 > 0:33:02Sounds like those figures have definitely convinced them to sell.
0:33:02 > 0:33:04So what's the time scale?
0:33:04 > 0:33:07We're going to move in, just for the short term.
0:33:07 > 0:33:10We've got our eye on something else to buy.
0:33:10 > 0:33:12We're waiting for that to come on the market.
0:33:12 > 0:33:16When that does, we'll sell this one
0:33:16 > 0:33:18to buy something in the village where we are.
0:33:18 > 0:33:21So, all's well that ends well.
0:33:21 > 0:33:25It's just a shame they had to do all that extra work to get the mortgage.
0:33:32 > 0:33:37We're now returning to a story we first featured in 2005.
0:33:37 > 0:33:41The beautiful Cornish countryside around Newquay was the location.
0:33:41 > 0:33:44With such stunning views, it was easy to see
0:33:44 > 0:33:47why house prices here had gone up over the years.
0:33:47 > 0:33:51The property I went to see was guided at £80,000.
0:33:51 > 0:33:56Four miles inland of Newquay is the little village of St Newlyn East.
0:33:56 > 0:33:58You'd hope the thing coming up
0:33:58 > 0:34:01for auction was some charming little cottage.
0:34:01 > 0:34:02It is!
0:34:04 > 0:34:07Just imagine what this could look like
0:34:07 > 0:34:09with a bit of attention and better weather.
0:34:09 > 0:34:12Add a few rambling roses
0:34:12 > 0:34:15and you've got yourself a really cute cottage,
0:34:15 > 0:34:18all for a guide price of £80,000.
0:34:22 > 0:34:25As soon as you come in the front door, you realise this is not an
0:34:25 > 0:34:27average end-of-terrace property.
0:34:27 > 0:34:30For a start, you've got that entrance there and then...
0:34:32 > 0:34:34..this room on the right...
0:34:36 > 0:34:38..and this room on the left.
0:34:38 > 0:34:41I get the impression that's setting the scene
0:34:41 > 0:34:43for some interesting stuff here.
0:34:45 > 0:34:47And interesting it certainly is.
0:34:47 > 0:34:50You've got two parallel rooms at the front of the house
0:34:50 > 0:34:54that lead into a corridor and then through to two rooms at the back.
0:34:54 > 0:34:58In this study, there's a great-looking fireplace
0:34:58 > 0:35:00and the kitchen looks out to the garden.
0:35:00 > 0:35:04But I'm concerned about all these cracks.
0:35:04 > 0:35:07Well, it was all going fine
0:35:07 > 0:35:11and then I came into the rear of the property and I saw this.
0:35:11 > 0:35:15At first glance I thought this was just really bad Artex
0:35:15 > 0:35:16or some funky wall covering.
0:35:16 > 0:35:18But it's not.
0:35:18 > 0:35:21In fact, it's very, very serious.
0:35:21 > 0:35:23I reckon if I...
0:35:27 > 0:35:28..take that off...
0:35:28 > 0:35:31I hope the new owner doesn't mind!
0:35:31 > 0:35:33Um... See this?
0:35:34 > 0:35:37This building is made from stuff called mundic block.
0:35:37 > 0:35:41It's very prevalent around these parts, in Cornwall especially.
0:35:41 > 0:35:45What they did is they used concrete for the construction.
0:35:45 > 0:35:51But that concrete contained bits and pieces from the mines.
0:35:51 > 0:35:53The result is that, over the years,
0:35:53 > 0:35:55it deteriorates.
0:35:55 > 0:35:59It basically means the whole of the rear of this property
0:35:59 > 0:36:01is likely to fall to pieces, as you can see.
0:36:01 > 0:36:04The serious effects of that - other than the obvious -
0:36:04 > 0:36:07are you can't get a mortgage on this property.
0:36:09 > 0:36:10Not good news.
0:36:13 > 0:36:18It appears that this sweet cottage is becoming very bitter indeed
0:36:18 > 0:36:21and means that whoever buys it will have to use cash.
0:36:21 > 0:36:24There's little chance of getting a loan on this property.
0:36:25 > 0:36:29Upstairs, though, there are four good-sized bedrooms
0:36:29 > 0:36:31in need of modernisation,
0:36:31 > 0:36:34a small shower room and a toilet on the landing
0:36:34 > 0:36:37and, of course, more cracks.
0:36:37 > 0:36:41At the rear of the property there's a good-sized plot of land
0:36:41 > 0:36:42but look at that.
0:36:42 > 0:36:45You can really see the problems with this house.
0:36:45 > 0:36:49It's almost a text book of things that can go wrong with property.
0:36:49 > 0:36:53Those cracks go all the way through. The whole rear is mundic block.
0:36:53 > 0:36:58It's a nightmare. The only thing to do is take the whole thing down.
0:36:58 > 0:37:00Demolish the whole of that rear.
0:37:00 > 0:37:03The good news is what you might build in its place.
0:37:03 > 0:37:08If you look next door, they've put a dormer window on the rear there
0:37:08 > 0:37:11and that's where the view is, so it's a nice thing to do.
0:37:11 > 0:37:13Great news is you've got the option
0:37:13 > 0:37:16to do that because it's an existing structure.
0:37:16 > 0:37:17Planners will say "Go ahead."
0:37:17 > 0:37:19I think that any buyer interested
0:37:19 > 0:37:23in maximising their potential from this rotten lot
0:37:23 > 0:37:26should invest their money into creating two cottages, not one.
0:37:26 > 0:37:30They'll need to keep those bill costs to a minimum.
0:37:30 > 0:37:35Even given the fact that half this property will have to be demolished,
0:37:35 > 0:37:38I still really like it.
0:37:38 > 0:37:42I believe it's a good investment and somebody can make money from it.
0:37:42 > 0:37:44So let's go to the auction.
0:37:51 > 0:37:54It's going to make £100,000.
0:37:54 > 0:37:57100. 110.
0:37:57 > 0:37:59120.
0:37:59 > 0:38:03120 I've got. 125. 125,500.
0:38:03 > 0:38:05126. And a half.
0:38:05 > 0:38:0727.
0:38:07 > 0:38:11And a half. 127,500 I've got against you, sir.
0:38:11 > 0:38:13128... Sorry, what have we got?
0:38:13 > 0:38:16Here. That's 128. Asking for 128 and a half, sir.
0:38:16 > 0:38:19128 and a half. 129, do I?
0:38:19 > 0:38:23At 128,500 I've got. Is there nine?
0:38:23 > 0:38:24129.
0:38:24 > 0:38:26129.
0:38:26 > 0:38:2829 and a half.
0:38:28 > 0:38:30130? At 130.
0:38:30 > 0:38:32135? 135. 135. Thank you.
0:38:32 > 0:38:35135. 140. I've got at 140.
0:38:35 > 0:38:37At 140. At 140. 141.
0:38:37 > 0:38:41At 141. 141. Do I see two?
0:38:41 > 0:38:42142. 142.
0:38:42 > 0:38:44142 and a half. 142 and a half.
0:38:44 > 0:38:47At 142 and a half. At 142,500.
0:38:47 > 0:38:50Now we go. Front row. 142 and a half.
0:38:50 > 0:38:52143? 143.
0:38:53 > 0:38:5544? Yes?
0:38:55 > 0:38:58Half. 143 and a half.
0:38:58 > 0:39:00144. 144.
0:39:00 > 0:39:02At 144. 145.
0:39:02 > 0:39:04At 145. At 145.
0:39:04 > 0:39:07At 145 this time out.
0:39:07 > 0:39:11At 145 first time. Second time. Third and last time. 145.
0:39:11 > 0:39:13Congratulations, sir. Well done.
0:39:13 > 0:39:19The final bid at £145,000 is well over the guide price of 80.
0:39:19 > 0:39:22Paying that amount are building partners and brothers,
0:39:22 > 0:39:27David and Mark. They've both been in the building industry for many years
0:39:27 > 0:39:29and felt it was time to start on their own.
0:39:29 > 0:39:33This is the second acquisition for their property developing company.
0:39:33 > 0:39:35David, very nice to meet you.
0:39:35 > 0:39:38- You too.- And Mark. - Hi.- Nice to meet you.
0:39:38 > 0:39:39What was it about this property
0:39:39 > 0:39:42that you thought for your second venture was right?
0:39:42 > 0:39:45When I saw it in the paper and I came to see it,
0:39:45 > 0:39:48I thought it was an extremely pretty cottage.
0:39:48 > 0:39:53On the front. It was a liquorice allsorts cottage. Fabulous.
0:39:53 > 0:39:56With the big lump on the back,
0:39:56 > 0:39:59it being mundic block, it puts a lot of people off.
0:39:59 > 0:40:02It's a lot of work. You have to demolish it and rebuild.
0:40:02 > 0:40:07So it's a big project to take on if you were just a homeowner.
0:40:07 > 0:40:11You can't move in and do it around you. So that took a lot of people
0:40:11 > 0:40:12out of the equation.
0:40:12 > 0:40:15- You knew about the mundic block problem?- Sure.
0:40:15 > 0:40:20The mundic block doesn't really matter. You can't sort it anyhow.
0:40:20 > 0:40:24The fact it is mundic block puts a lot of people off.
0:40:24 > 0:40:29That's a sort of benefit there anyhow. That helps, basically.
0:40:29 > 0:40:31It helps.
0:40:31 > 0:40:36Not only does the crumbling mundic block not put David and Mark off,
0:40:36 > 0:40:38it's one of the main reasons they went for it.
0:40:38 > 0:40:42So what have they got planned for this shaky little cottage?
0:40:42 > 0:40:46Best case scenario which we wouldn't envisage having any problems with
0:40:46 > 0:40:49is getting planning for a pair of cottages -
0:40:49 > 0:40:53the original Cornish stone-built one at the front here,
0:40:53 > 0:40:56two beds, bathroom, lovely pretty little one,
0:40:56 > 0:41:00and possibly a three-bed new cottage at the rear.
0:41:00 > 0:41:04Well, two properties are better than one,
0:41:04 > 0:41:07and the brothers have given themselves a budget of £100,000
0:41:07 > 0:41:09for the work.
0:41:09 > 0:41:13They don't want to waste any time and have already had plans drawn up.
0:41:15 > 0:41:17These are literally hot off the presses!
0:41:17 > 0:41:19Yeah, I picked them up this morning.
0:41:19 > 0:41:22Talk me through them, then.
0:41:22 > 0:41:27Well, this first one, we basically keep the original cottage
0:41:27 > 0:41:30with a porch area coming out there.
0:41:30 > 0:41:34We've got a lounge, staircase in the middle and kitchen.
0:41:34 > 0:41:36Upstairs a double bedroom and a single bedroom
0:41:36 > 0:41:40and we'd give a floating freehold across the new build,
0:41:40 > 0:41:42which will be the new build,
0:41:42 > 0:41:45and we add a bathroom on the first floor of the new build.
0:41:45 > 0:41:49Because the back one becomes what you'd call an upside-down house.
0:41:49 > 0:41:52You've got the bedrooms downstairs in this one.
0:41:52 > 0:41:55And the bathroom underneath the bathroom of this house.
0:41:55 > 0:41:57Then we have the lounge and kitchen
0:41:57 > 0:42:00upstairs because of the views across the fields.
0:42:00 > 0:42:03You can see the sea from the back, so that's very nice.
0:42:03 > 0:42:06What we haven't got a plan for yet is we want planning
0:42:06 > 0:42:09for a third bedroom in the loft, with a dormer.
0:42:09 > 0:42:11So this back one becomes a three-bed unit.
0:42:11 > 0:42:14Any idea of time, how long this is going to take?
0:42:14 > 0:42:17Probably about six months, I'd say.
0:42:17 > 0:42:20Really? To completely finish it?
0:42:20 > 0:42:22If we don't keep going in the pub next door!
0:42:22 > 0:42:24About six months, yeah.
0:42:24 > 0:42:29Well, the plans looked great but the timescale was ambitious.
0:42:29 > 0:42:33So when we first returned to check on progress after five months,
0:42:33 > 0:42:37it was no real surprise that the main difference was that half of it
0:42:37 > 0:42:38had been demolished
0:42:38 > 0:42:42and that only the groundwork for the new house had begun.
0:42:44 > 0:42:49But stay with us till later and you'll see the fabulous finished
0:42:49 > 0:42:50development three years on.
0:42:53 > 0:42:58"Time is money" is a much overused expression, but you know, it's true!
0:42:58 > 0:43:01If your project runs over schedule,
0:43:01 > 0:43:03you can bet your bank balance will take a hit.
0:43:03 > 0:43:07Let's find out how today's purchasers have been getting on.
0:43:11 > 0:43:15We're back in stylish upmarket Notting Hill,
0:43:15 > 0:43:18specifically, the world-famous Portobello Road.
0:43:21 > 0:43:26Developer Simon bought this two-bedroomed house for 980,000.
0:43:26 > 0:43:29He had grand plans to build a third bedroom on the top
0:43:29 > 0:43:32and extend into that yard space.
0:43:32 > 0:43:34He was confident he could walk away
0:43:34 > 0:43:38with a great return on his investment.
0:43:38 > 0:43:41I think that will provide the key to the profit in this property,
0:43:41 > 0:43:42the extra bedroom.
0:43:42 > 0:43:45We caught up with Simon five months later
0:43:45 > 0:43:47to see how the project had gone.
0:43:47 > 0:43:51Curiously, he had not done any work at all.
0:43:51 > 0:43:53# It's the same
0:43:54 > 0:43:56# It's the same
0:43:57 > 0:43:59# It's the same... #
0:43:59 > 0:44:00In fact,
0:44:00 > 0:44:02Simon had a change of plan.
0:44:02 > 0:44:06He decided to take advantage of improving property prices
0:44:06 > 0:44:10and put the house back on the market with a local estate agent.
0:44:10 > 0:44:14I obviously sold the property on without doing any works.
0:44:14 > 0:44:17Which was not my original intention,
0:44:17 > 0:44:22but I was, er, pressurised, if you like,
0:44:22 > 0:44:25by the offer that came forward.
0:44:25 > 0:44:28As the property has the kudos of being on Portobello Road,
0:44:28 > 0:44:31more than 30 people phoned up about it.
0:44:31 > 0:44:34One offer was just too good to refuse.
0:44:38 > 0:44:44I did, in fact, receive an offer which I accepted of 1,250,000,
0:44:44 > 0:44:49which was certainly a tremendous profit on my original purchase price
0:44:49 > 0:44:51at auction, 980,000.
0:44:51 > 0:44:55Simon judged the market perfectly.
0:44:55 > 0:45:00His resale made just over 25% pre-tax profit,
0:45:00 > 0:45:02minus any legal fees, of course.
0:45:02 > 0:45:06Although he could probably have made more if he'd done the alterations,
0:45:06 > 0:45:09Simon feels he may have saved himself a headache
0:45:09 > 0:45:10with the planners.
0:45:10 > 0:45:13There is always a risk when you apply for planning
0:45:13 > 0:45:15that you won't get it.
0:45:15 > 0:45:18You might upset the neighbours, you might upset the conservation people,
0:45:18 > 0:45:22or Fred Bloggs down the road, I don't know who you can upset.
0:45:22 > 0:45:25So by selling it on as I had,
0:45:25 > 0:45:29I definitely risked my exposure to the planners
0:45:29 > 0:45:33and I also saved myself the expense of going through the motions
0:45:33 > 0:45:35of the planning application
0:45:35 > 0:45:40and I think it was the right decision for me, at the time.
0:45:40 > 0:45:43It sounds like Simon made a shrewd decision.
0:45:43 > 0:45:46Planning permission could have proved much trickier
0:45:46 > 0:45:47than he'd first hoped.
0:45:47 > 0:45:49He fears the work could have cost 150,000,
0:45:49 > 0:45:5150,000 over his original budget.
0:45:51 > 0:45:56Instead, he's managed to make a fantastic pre-tax profit
0:45:56 > 0:46:00of £280,000 in just five months.
0:46:00 > 0:46:01Only in Notting Hill!
0:46:01 > 0:46:07So what do two property experts make of that 1.25 million resale price?
0:46:07 > 0:46:10Coming in for the first time, it's a lovely house.
0:46:10 > 0:46:13In terms of the area, it's very much what people want.
0:46:13 > 0:46:16There's a huge short supply.
0:46:16 > 0:46:18There's lots of lovely period features
0:46:18 > 0:46:20and that lovely cottage feel.
0:46:22 > 0:46:24Although no renovation work was done here,
0:46:24 > 0:46:28how has the value been affected by an improving property market?
0:46:31 > 0:46:34Demand has really picked up from overseas buyers.
0:46:34 > 0:46:36There's a real shortage of stock.
0:46:36 > 0:46:39That's had a positive impact on prices recently.
0:46:40 > 0:46:45The market has improved certainly over the last four or five months.
0:46:45 > 0:46:48There's still a bit of caution out there.
0:46:48 > 0:46:51People think we're through the worst of the troubles
0:46:51 > 0:46:52and are prepared to commit.
0:46:52 > 0:46:55With that healthier market in mind,
0:46:55 > 0:46:57what do they think this property is worth?
0:47:01 > 0:47:03We'd be looking to achieve around 1.2 million.
0:47:03 > 0:47:04In this condition,
0:47:04 > 0:47:07I'd put this property on the market at 1.25 million.
0:47:07 > 0:47:10To hear that news is very good, very satisfying.
0:47:10 > 0:47:12I didn't undersell it. It's exactly the right price.
0:47:12 > 0:47:15So great news. Really pleased.
0:47:16 > 0:47:20Even though Simon could have made more money had he held onto it
0:47:20 > 0:47:21and done the work,
0:47:21 > 0:47:24he has no regrets about selling it sooner rather than later.
0:47:27 > 0:47:30You can always look forward in two years and say,
0:47:30 > 0:47:31"I've sold it too cheap",
0:47:31 > 0:47:35which you will because property prices will go up,
0:47:35 > 0:47:39but at the time I think I made the right decision.
0:47:39 > 0:47:41I've obviously sold it for the right price.
0:47:41 > 0:47:44I've taken my profit, I've moved on
0:47:44 > 0:47:47and I'm off onto a new project.
0:47:47 > 0:47:49All very exciting for me.
0:47:55 > 0:47:57When we first visited
0:47:57 > 0:48:01this delightful four-bed Cornish property just outside Newquay,
0:48:01 > 0:48:05brothers David and Mark had just bought it for 145,000.
0:48:05 > 0:48:10They're both builders and planned to convert it into two separate houses.
0:48:12 > 0:48:15But behind that quaint exterior
0:48:15 > 0:48:17lay a disaster.
0:48:17 > 0:48:21The rear of the property was an extension built of mundic block,
0:48:21 > 0:48:23which was crumbling away.
0:48:23 > 0:48:26So they planned to knock it down and rebuild.
0:48:28 > 0:48:33When we first returned four months later, the demolition had begun.
0:48:33 > 0:48:37Where originally two cottages had stood, only half of one remained,
0:48:37 > 0:48:39plus a large hole.
0:48:39 > 0:48:42The brothers had successfully obtained planning permission
0:48:42 > 0:48:45for the new building and groundwork had begun.
0:48:48 > 0:48:52David and Mark had spent 145,000 on auction day
0:48:52 > 0:48:56and had a budget of £100,000 for the new build and renovation.
0:48:58 > 0:49:01But were they sticking to that? How much had they spent so far?
0:49:03 > 0:49:07Pretty bang on with what we expected to spend to get out the ground.
0:49:07 > 0:49:09When we get out of the ground.
0:49:09 > 0:49:14The demolition, the planning and the architect's fees.
0:49:14 > 0:49:17There's always extras in any project like this. The unforeseen.
0:49:17 > 0:49:19If we get within £10,000 either way
0:49:19 > 0:49:23of our original estimate, which is about £100,000,
0:49:23 > 0:49:25then we'll be extremely happy.
0:49:25 > 0:49:28And it's looking at the moment that we'll do that.
0:49:29 > 0:49:31I hope so, because David and Mark
0:49:31 > 0:49:34had completely knocked the innards out of the cottage
0:49:34 > 0:49:37and only the groundwork had begun on the new build.
0:49:40 > 0:49:44Three years later, we went back to see the two houses.
0:49:45 > 0:49:49Both of them were completed and sold a couple of years ago.
0:49:50 > 0:49:52Through that new porch
0:49:52 > 0:49:55into the original cottage to the left of the stairs,
0:49:55 > 0:49:57there's a wonderful new living room.
0:49:57 > 0:50:00Every little bit of space has been used.
0:50:01 > 0:50:05On the other side of the staircase, a superb kitchen has been created.
0:50:05 > 0:50:08The old cottage looks fantastic. What a transformation!
0:50:12 > 0:50:16Upstairs you'll find the new bathroom which has been built
0:50:16 > 0:50:19in the new property above the bathroom on the ground floor.
0:50:21 > 0:50:24Once again, the original front cottage has a cottage
0:50:24 > 0:50:25attached to the back.
0:50:25 > 0:50:29Unfortunately, we can't get inside today, but as originally planned,
0:50:29 > 0:50:32that has two bedrooms and the bathroom on the ground floor
0:50:32 > 0:50:35with a living room and kitchen upstairs.
0:50:35 > 0:50:37And it's a three-bed house,
0:50:37 > 0:50:40because the planners agreed to an extra bedroom in the attic.
0:50:40 > 0:50:45However, attaching it to the original cottage wasn't easy.
0:50:45 > 0:50:46We had quite a bit of difficulty
0:50:46 > 0:50:49joining the new build to the old build
0:50:49 > 0:50:50because it was all the mundic block
0:50:50 > 0:50:54when we knocked it down and we had cob.
0:50:54 > 0:50:56So we built two concrete stanchions
0:50:56 > 0:50:59and more or less put a concrete ring beam around the whole cottage,
0:50:59 > 0:51:01enabling us to join the new house onto the back.
0:51:01 > 0:51:05And we got a nice bit of slate on the front.
0:51:05 > 0:51:09It's a quite pretty little house in the end. Couple of dormers
0:51:09 > 0:51:11at the top. Very pleased with it.
0:51:11 > 0:51:14David and his brother Mark sold both houses to local people.
0:51:14 > 0:51:17There's a professional couple in the new build,
0:51:17 > 0:51:20while the cottage with its bathroom and two bedrooms upstairs
0:51:20 > 0:51:23is now home to Sue, a matron at the local hospice.
0:51:26 > 0:51:28And there must be something about the place
0:51:28 > 0:51:30because David's moved down here.
0:51:30 > 0:51:34He's renting another house in the village. What about his brother?
0:51:34 > 0:51:39My brother, Mark, we bought an old cafe in London
0:51:39 > 0:51:42which we got planning permission to turn into two flats.
0:51:42 > 0:51:44He's working on that at the moment.
0:51:45 > 0:51:48As well as that property in London,
0:51:48 > 0:51:52they also have a three-bed bungalow nearby to renovate as well.
0:51:52 > 0:51:54But have there been any problems with this one?
0:51:55 > 0:51:59There's been a lot of soundproofing problems between the two bathrooms.
0:51:59 > 0:52:03Just for the bathroom floor alone it was £500 just to soundproof it.
0:52:03 > 0:52:07There were extra costs which I didn't realise. But overall,
0:52:07 > 0:52:09it was a pretty standard build with added extras,
0:52:09 > 0:52:11but pretty good in the end.
0:52:13 > 0:52:16The brothers paid 145,000 on auction day for the cottage
0:52:16 > 0:52:19and had budgeted £100,000 for the work.
0:52:19 > 0:52:23They initially sold the cottage for 190,000
0:52:23 > 0:52:27and then six months later the new house achieved 215,000.
0:52:27 > 0:52:32So there could be a very impressive £160,000 gross profit
0:52:32 > 0:52:34if they managed to keep to the budget.
0:52:35 > 0:52:37The initial budget was about 100.
0:52:37 > 0:52:44We went over that by probably I'd say 25%
0:52:44 > 0:52:47because of all the extras that were unforeseen.
0:52:47 > 0:52:51The flooring soundproofing between the two houses was expensive
0:52:51 > 0:52:53and the stanchions and stuff.
0:52:53 > 0:52:56It was quite an awkward site to work on. Not a lot of area.
0:52:57 > 0:53:02£135,000 gross profit before the usual expenses
0:53:02 > 0:53:04didn't sound too bad.
0:53:04 > 0:53:08Sue's very pleased she bought the cottage. It's a wonderful new home.
0:53:10 > 0:53:13Really, it was the minute I walked into it.
0:53:13 > 0:53:17It had such a lovely atmosphere about it
0:53:17 > 0:53:20and it was perfect for me, being on my own at the time.
0:53:20 > 0:53:25I didn't want a big garden or anything.
0:53:25 > 0:53:28It was perfect to move straight in. Didn't have to do anything.
0:53:31 > 0:53:34What do two estate agents think of the refurbished cottage
0:53:34 > 0:53:38with its bathroom built on the first floor of the new house.
0:53:39 > 0:53:43They've done a really good job. It has the outside facade of a cottage
0:53:43 > 0:53:45with the benefits of a new house.
0:53:45 > 0:53:48Given the original project, he's done a very good job.
0:53:48 > 0:53:53Super property. Not very large, but it has everything you want.
0:53:53 > 0:53:56The whole thing is reasonably compact, but that does no harm.
0:53:56 > 0:54:01It just dictates what the purchaser wants at the end of the day.
0:54:01 > 0:54:05Quite close to the beaches, quite central to the A30.
0:54:05 > 0:54:07Newquay airport quite close by.
0:54:07 > 0:54:10It could be a second home, or someone looking for an investment
0:54:10 > 0:54:11on a rental basis.
0:54:11 > 0:54:15The cottage has the thumbs up from the estate agents.
0:54:15 > 0:54:19But it's looking like there could be a change of occupant.
0:54:19 > 0:54:23Having been here for 19 months, it's time for me to move on.
0:54:23 > 0:54:26But I'd like to keep this place and let it out.
0:54:26 > 0:54:29So how much rent could the cottage earn?
0:54:31 > 0:54:32In the rental market,
0:54:32 > 0:54:36we'd be looking at 550 to 600 per calendar month.
0:54:36 > 0:54:38Rental would be very popular for this
0:54:38 > 0:54:41as an alternative to an apartment in Newquay.
0:54:41 > 0:54:45£650 a month quite comfortably for this one.
0:54:45 > 0:54:48Was that the sort of income Sue expected, and who does she think
0:54:48 > 0:54:50the cottage will appeal to?
0:54:50 > 0:54:54I guess that would be about what I would think it would be worth.
0:54:54 > 0:54:58I think this would suit a young professional couple.
0:54:58 > 0:55:00It would be perfect for that.
0:55:00 > 0:55:05How much are the properties now worth? David sold them in 2007,
0:55:05 > 0:55:09just before the property crunch took hold, for 190,000
0:55:09 > 0:55:13and then the three-bed house for 215,000.
0:55:13 > 0:55:18I would suggest this is probably worth about 150 to 155.
0:55:18 > 0:55:21I'd market it at 159,950.
0:55:21 > 0:55:24If I was bringing this property to the market today,
0:55:24 > 0:55:26I'd imagine 165 to 170.
0:55:26 > 0:55:30The house at the rear, three bedrooms and the outside space,
0:55:30 > 0:55:33I'd say a guide price of 200.
0:55:33 > 0:55:35I haven't actually seen the inside of next door,
0:55:35 > 0:55:38but assuming it's finished to the same standard,
0:55:38 > 0:55:43I'd expect that one to achieve something in the region of 185, 190.
0:55:45 > 0:55:47Property prices are recovering,
0:55:47 > 0:55:50but 165 to 170 for the front cottage
0:55:50 > 0:55:55is still 20 to £25,000 less than David sold it for two years ago.
0:55:56 > 0:55:59I think you'll get more for it than 170, even today.
0:55:59 > 0:56:01It's a one-off cottage.
0:56:01 > 0:56:05If someone wants that, they'll pay a bit more cos it's a premium thing.
0:56:05 > 0:56:08There aren't that many about. It's worth its money.
0:56:08 > 0:56:13And that valuation of between 185 and 200 for the new house?
0:56:13 > 0:56:18I would say that would be round about right as the market is today.
0:56:18 > 0:56:21That wouldn't be far off. But I'd say more for the front one.
0:56:21 > 0:56:23So David's moved down to Cornwall.
0:56:23 > 0:56:25Is he going to spend more time on the beach
0:56:25 > 0:56:29or is he on the look-out for property opportunities?
0:56:29 > 0:56:34Yeah, I'll carry on building. I've done it all my life, so I enjoy it.
0:56:34 > 0:56:36It's something I enjoy
0:56:36 > 0:56:38and I'm beginning to enjoy
0:56:38 > 0:56:41the design part of it more now than the build.
0:56:41 > 0:56:45I'm trying to put a bit of that into it as well.
0:56:48 > 0:56:50It goes to show, you never know
0:56:50 > 0:56:53the stories you're going to hear on Homes Under The Hammer.
0:56:53 > 0:56:57So join us next time for tales of subsidence and success!
0:56:57 > 0:56:59- See you then.- Bye!- Goodbye!
0:57:20 > 0:57:23Subtitles by Red Bee Media Ltd