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Despite the credit crunch people still want a slice of the property action.
If you want to the plunge, auctions are a great place to start.
It can be fraught, it can be fantastic, whatever happens it's fun
when you buy your property under the hammer.
Now, some properties are very popular at auction, others go unsold.
So the auction room can be a very difficult place to conquer.
Let's take a look at what inspired the buyers on today's show.
This terraced house in Derby has all you need for a good investment.
It's not in bad condition and, of course, it's so close to the city centre you can't go wrong.
There's a property in Kent with Titanic proportions.
This is just the tip of the iceberg.
Let's get upstairs and see the real opportunities.
And in rural Devon, this cute cottage has plenty
to charm everyone, but what we don't like is this wall here.
All these properties are being sold at auction and we find out who bought them
-and what they paid for them when they went under the hammer.
-Sir, well done.
I'm in Derby, a city of many facets. It's a former Victorian
industrial centre with the smallest cathedral in Britain.
It also has a busy university, a large
new shopping centre and commercial developments springing up all over.
Now I don't know how much that doggie in the window is,
but I'm hoping we're in line for a property bargain here today.
There's an interesting fact, 70% of people in Derby own their own homes.
Great for them, bad news if you're looking to rent somewhere.
However, doubly good news, if you're looking to buy-to-let,
and the property I'm here to see could be absolutely ideal for that.
It's two bedroomed, it's mid-terrace at a guide price of 77,000 quid.
As Derby has a high demand for rental properties,
this street, 10 minutes walk from the city centre could be just the ticket. So what's it like inside?
Well, straight away I'm seeing it's a little tired, in need of sort of a bit of loving care,
but good high ceilings and also some original features,
which is always a nice thing to see.
Through a little, well, sort of, archway there into the rear living room area.
Again, not a bad size, horrible fireplace, get rid of that,
put something nicer in its place, but decent enough kitchen.
All in all, pretty much what you'd expect.
OK, it's what you'd hope to find, really.
Nothing too awful, but with enough scope that you could make your mark here.
Upstairs are two double bedrooms
with a bathroom at the back, which makes the world of difference.
There are signs of damp here and there, but that could just be
condensation after years of furniture being pushed up against the wall.
So far so good then,
and this little terrace is hiding a nice little bonus.
Ladies and gentlemen, please join me back outside.
Well, the property benefits from its own alleyway leading to the rear.
Why is that a benefit? It means that you can actually stop using
the front door and use this rear door as the main access to the property.
Why does that matter? Well, it means you can rent out that front room as an extra bedroom.
That could generate you an extra £50 a week in rent.
So thank goodness for the alleyway.
Of course, this extra room only really applies to the student market,
but as there are quite a few students around here, that would certainly be good to bear in mind.
As well as the alley at the back, there's a rather lovely garden.
It is overgrown, but knocks the traditional yard into a cocked hat.
There's also the old outside loo that could go to make way for useful
storage and what would probably have been the coal store in days gone by.
And talking of the past,
you know what, I don't think this street will have changed much over,
well, 100 years or so since these houses were built and there's proof of that here, look.
A bit of graffiti carved in 1917, maybe by the kids who lived
in this house, probably in between playing marbles out on the pavement while mum polished the step.
You do get that flavour here.
And you know what, the houses were practical then and they're practical now.
The living conditions have improved a lot.
Now you're more likely to find students and young couples starting their adult lives here
rather than entire families crammed into two bedrooms.
In essence these two-up-two-downs do work and make for solid investments.
I asked the auctioneer who sold the place for his thoughts.
They're typical terraced house streets around here but they do
appeal to first time buyers,
but there's also quite a bit of rented accommodation too.
This house is very typical for a property that has been rented out
for some years. It's a bit tired, needs a bit of TLC,
it's not structurally in disrepair and there's nothing major here.
A lot of it is cosmetic, superficial work,
but it just wants a bit of hard work doing to it.
The guide price for this property was £77,000. Is it worth that?
This would be a good investment property, whether you bought it
to rent it out or you bought it to come and live in it.
If this was a student house, and it has been in its past,
it would accommodate three students, two in the bedrooms upstairs and one in the front room downstairs,
using the back door as the entry, and they would pay something in the order of £52, £53 a week.
So you're talking about an income of about £8,000 a year.
So a promising little earner.
What about its resale value?
As it stands now, its value would be around £85,000.
Brought up to a good standard where you don't need to do anything else to it at all
you'd probably get it to £100,000 without too much difficulty and could even be a bit over that.
Well, the house really does have everything you could want from a good investment.
It's not in bad condition, it's got broad appeal
and, of course, it's so close to the city centre you can't go wrong.
Let's see whose head was turned when this went under the hammer.
Lot number three today is a traditional two double-bedroomed terraced house.
How much must I say for this one? Start me on this where you will, £80,000.
78? 75 to start me?
75 I have, thank you.
At £75,000. At £75,000.
76 somewhere else? 76 is bid. 77.
At 77,000, 78, 79.
At 79. 80,000? £80,000. 81, at 81.
81, 82, 82, 83. 83,000. 84?
I'll take the half. The bid is 83,000, it's in the market, we're going to sell.
At 83,500 quickly?
For the first time, second time, third and last chance.
Sold at 83,000. Thank you.
That successful bid came from Kim and her father, Dean.
Marketing assistant, Kim,
bought the house for £83,000 with her boyfriend, Dom, who installs cash registers.
They're first time buyers and hope to move in as soon as possible.
I met them back at their purchase to find out their plans.
-Dominic, Kim, congratulations. Lovely to meet you both.
Tell me why you wanted to buy this place.
Well, we've been looking around for about six months now and nothing really
meets our specification and then we thought, we saw this and thought this was perfect really, didn't we?
Yeah. We've been living in this area for about a year, so.
-Oh, OK, so you've bought it for yourselves to live in then?
-After we've done the work.
-Is this the first house you've bought together?
-Both first time buyers, yeah.
-How is for first time buyers at the moment?
-It's quite difficult, isn't it?
Yeah. We've been lucky because my dad's an estate agent, so we've had a lot of help and advice
from him along the way, but I can see it's quite difficult to sort
-everything out and get the mortgage together and stuff like that.
-Yeah. Get enough money to buy, really.
Right. So tell me about you two then, how long have you been together?
We've been together about two and a half years now, I'd say.
We moved in about a year ago. I thought we'd sort of
test the waters a bit and just sort of rent for a while.
-See if we could live with each other, stand each other.
We thought we'd take the plunge and look to buying.
Obviously we both wanted different things and things like that, but I think we've done well here.
Compromise is the name of the game when it comes to living together.
The first compromise they've already reached is about how they keep
football crazy Dom up to date with the beautiful game.
-So you're going to have a separate room with the telly in it then?
-Well, we're putting a TV on that wall.
-We have planned, yeah, we're going to do that in this one.
-And in that one as well.
-Two tellies downstairs.
-THEY LAUGH You can watch the footie in the other room.
-Yeah, on the big TV.
But aside from the pressing issues of the Premiership, their goal is to do some structural changes here.
We're going to knock this wall out so we've got an open plan kitchen diner.
-New kitchen in as well actually.
-And then just decoration really isn't it?
How are you going to take that wall out, because that's a fairly major supporting wall that, isn't it?
-Well, I'm not, the builders can do that.
That's an exterior wall of the house.
-Well, I think he's taking it to sort of there and then just putting in a supporting RSJ.
Outside we're obviously got the outhouses, which we're hoping to use as a bit of a utility space.
-What kind of feel are you going for in the house?
-Clean, modern, really.
Just keeping everything neutral, nothing too...
Yeah, keep it sort of looking as spacious as we can, really.
Yeah, lots of light.
What sort of budget have you got?
Around 8,000 we think at the moment, and I've been told that obviously
we're probably going to go over that a bit.
Why did you defer to Kim when I asked about the budget?
-Because she's the one with the purse strings, really.
I think I'll probably spend about 12, 15 if I could, getting all gadgets and stuff but...
I think Kim's going to have to keep an eye on Dom.
He's already bagged the big TV, what next?
They don't plan to do much upstairs apart from renewing the bathroom.
That could be quite doable on their budget, but what about their timescale?
Well, we've got to be out of our rented property in three weeks time
-so we're hoping to have it liveable in three weeks.
What, 21 days?! THEY LAUGH
-We are aware that is probably, well we are hoping it's going to happen but
we know that there's a bit of work to do.
Hopefully in three weeks time we've got the kitchen and bathroom done
and then obviously we can just do the rest ourselves when we've got time really.
So both of you have full time jobs, so I you're going to
-do all of this in 21 days of evenings and weekends.
We'll have to rope in quite a few friends I think.
-We're hoping for a lot of help aren't we?
-Yeah. We'll need it.
Well, listen, good luck and we'll give you a month or so and see how you've got on.
So, three weeks to knock down a supporting wall, install an RSJ, fit a new kitchen,
fit a new bathroom, completely redecorate and sort the house out, with full time jobs.
Now there is a challenge. Will they manage it and will Dominic manage to nick a bit of money for some gadgets?
You can find out later in the show.
I'm in Sittingbourne, Kent.
Until a few years ago, this was home to the Sittingbourne paper mill,
once the largest producer of paper and newsprint in the world.
But the question is, will today's auction lot be a licence to print money?
I'm right on Sittingbourne High Street and it's a rather substantial property we've got to explore.
In fact, it's all this. Now, it's numbers 15, 17 and 19,
which includes the freehold of the shop of 15 and 17,
but not the ownership.
But with everything above the commercial units included and number
19 thrown into the mix, well it's a substantial amount to explore,
and all for a guide of £140,000 to £150,000, I'd better get my skates on.
The main space we're interested in are
the offices above the two shops and the small shop unit on the corner.
All this was formerly the home of a local newspaper.
So time to get inside and see if I can root out the story.
Now the entrance is through number 19, formerly the reception to the newspaper offices.
Now this little space has to remain as commercial or retail premises,
I know the council will not budge on that. But it is pretty small.
Maybe you could apply for change of use for a coffee bar,
a little deli maybe, but this, this is just the tip of the iceberg.
Let's get upstairs and find the real opportunities.
So up here are where the offices were based for the local newspaper.
You can see you've got the editor's office through there.
It really does have that sort of commercial feel to it.
You've got lots of false ceiling tiles, strip lighting,
woodchip wall paper everywhere, but it is a warren of rooms.
You've got a big kitchen area through there, an office, an even bigger office through there,
but what I do like about this place is look at this flooring.
You've got some gorgeous original parquet floor tiles here and I do
happen to know they run right the way through this floor. And looking around, do you know what?
These offices are just ready to go.
But there's one thing I'd like to do. They're a bit dirty, give them a dust.
This floor seems in pretty good nick.
You can easily imagine a line of journalists in here, typing frantically to meet their deadlines.
But for part three of our tour I'd like you to walk with me
through this rather uninviting walkway to somewhere with even more space.
You know it just gets bigger and bigger!
You've actually got a further 800 square feet of office space and an attic up there.
Now, all of this commercial space has wonderful light, open feel to it with these massive windows.
Now, it could be a pleasant place to work.
I think you'd probably get around £14,000 to £20,000 rent for this per annum which isn't bad, but I can't
help feel these former newspaper offices are hiding a bigger story.
My sources tell me the exclusive is to be found round the back.
Oh, and there's a news flash. As if the floor upon floor of square footage wasn't enough,
one of the real bonuses of this property is what lurks outside.
The property comes with a large car park and this space is the
key to the building and the real development potential.
Now I know the local authority are really trying to regenerate the area and bring people back into
the centre of town and they may look favourably on a residential development.
Now the space is clearly there for four, maybe five, units and what about extending up?
A roof extension, well I think it would give you even more square
footage and I don't think it would be too out of place on the road.
Now you may well get planning without parking,
but I think you'd limit your market and restrict the values.
So it all hangs on this square of tarmac. Amazing.
This building comes with 16 parking lots,
that's more than enough for four or five flats and, more importantly,
plenty to keep the planners happy.
Plus it gives the place options. You may be hard pressed to make money
out of this as commercial offices, but as a residential space,
it could be really good news financially.
What does a local estate agent think?
A very difficult property to envisage a new use for,
other than conversion perhaps to residential.
There's very little demand for offices of this sort of nature
in High Street locations nowadays.
Could flats generate sufficient returns to make them worth considering?
If you were able to convert this into flats, one bedroom units, probably for rental about £500
a month, perhaps £75,000, £85,000, two bedroom units at the moment
perhaps £550, £600 a month, perhaps £85,000 to £95,000.
If you were granted permission to convert this to four or five flats you could get over £400,000.
Not bad for a building that was guided at 140 to 150,000.
This is a lot of property for the money, but you'd still have to be careful with your cash.
As commercial premises, these are never going to net you big bucks and if you converted them
into flats, well there's money to be made but also plenty of hoops to jump through.
Let's see if these old newspaper offices
made headlines at the auction.
Lot 62 then is 15 to 19 High Street in Sittingbourne.
Where do you want to start me then? Start me at 130? 130.
I'm on the way at 130, 130 I've got.
Now 135. At 135. It's with you at 130, 135 at the back. 140.
140. 145 anywhere?
145 I've got, waving at me.
145, 150, I've got. 150, and 5, 155,000?
The first time then at £150,000.
Second time at 150,000 if you're sure you're all done, because it's going to be sold.
Third and final time at £150,000, the gentleman standing right in front of me, you're all done?
It's yours, sir, for £150,000.
It was local man Steve who scooped this former
newspaper office at the top end of the guide price for 150,000.
He and his business partner Ian joined me there to give us the exclusive on their plans for it.
-You paid the upper end
of the guide price, £150,000, were you pleased with that?
Very pleased with it. I mean we would have gone up to about 165.
You have got a lot of building here for that money, I think.
There is a lot of square footage here, yes.
It just seems to go on and on. I mean the first time Steve showed me around it just kept going and going.
You went into another room and it was impressive.
So what are you going to do with this place?
Well, what are you going to do with it? HE LAUGHS
What's your involvement both of you? Because you were at the auction and you weren't.
-We do quite a bit of development ourselves because I've got my own building firm and
we've got a development side as well and last year I said to Ian, does he want to come into it?
And we did a development with Ian and my brother and then this one came up and we
went through some costings and looked at what we could do here, came up with some
figures and then Ian said yes, and then I just went with the chequebook to the auction and bought it.
So Ian, how did you feel when Steve phoned you up and said, I've got it?
I'm lucky, really, he's one of the few guys I know that I would trust implicitly, so when he says
it's a good deal and a good buy and it's going to make us money, I believe him.
So how involved are you with the property world?
-Oh, um, yeah...
-I kind of gave up building at the Lego level, really, to be honest.
I basically write him a cheque, he goes and spends it and shows me a place at the end of it.
What do you do at the moment then?
I work up in the city. I probably shouldn't say that, we're not too liked at the moment.
But I'm not a trader, I'm an accountant, but I work for an investment bank.
So good with the finances.
I'm OK with finances. I actually trained as accountant just round the corner, just up the road at a local
accountancy firm, so I know the area pretty well, I grew up in the area, I know what it's like, and when he said
there's this big place on the High Street it's yeah, it seemed good.
Well, they seem like the perfect team, a builder and a backer, but with nearly 350 square metres
this is a big project and not just because of its size.
So you have all this space up here, corridors, a warren of rooms,
upstairs, this floor, what are you going to do with all this space?
Well, the shop downstairs has got to stay as a commercial property so that has to stay as retail,
but we're going to convert it, or try if we can get through planning, turn it into flats, and we should,
fingers crossed, get five or six flats in here.
Three two bedders and three one bedders, that's the plan.
-It's fair to stay we priced it on five.
-Priced it on five, yeah.
So if we get five we do OK.
If we get six, real bonus.
Yeah. The biggest selling point for us was the car park out the back.
People buy places, "Oh, I'll turn it into four flats", then find you have
one parking space and then planning won't allow you to convert it.
Now, with a car park with 16 spaces in it, it gives us complete scope
to keep the shop downstairs, to keep the flats, we could probably, we've got enough car parking really for
ten flats, but obviously the footage isn't big enough for that, so we've got the parking for that as well.
So not only have they got the parking,
but other offices along the street have also been converted to flats.
So there's a precedent here, however it is in a conservation area
and there is a chance it's listed. But touch wood...
they're confident that they will get planning permission for the flats.
Have you thought about the budget and how much you guys are willing to spend on this project?
Yeah, definitely I wouldn't go into anything without actually
-thinking through the numbers but we figure about 200,000 development on top of the 150...
..purchase price for the property so sort of 350,000, maybe up to 400,000
depending on once we get into the real sort of detail of it.
So how much do you think you're going to sell each individual unit for?
Reckon the three one bedroom flats, being really pessimistic,
probably about 70K each, and the three two bedders at 90K each.
So you're probably looking at all in, doing the sums, is 480 isn't it?
-See, he knows, he works in finance, yep that's it!
And I'm pessimistic.
So 480, if we can get it done for 400, that's including all costs, VAT, and everything else as well,
that gives us 20% return and that's worse case scenario, I think anyway.
And that's not even taking into account the business that you're going to have downstairs.
That's without the business downstairs, um...
But to be fair that's going to be a bit of fun.
That's going to be a bit of fun. It could be a bit of a Brucie Bonus,
I suppose if we get a little bit extra out of it, but it's not going to be a huge amount.
I mean a unit like that is not going to rent for much.
-It's pretty small.
-So we might as well have fun with it and do something with it,
-we've just got to decide.
-We just haven't decided.
-No idea at all yet.
-Chaps, you've got an awful lot of work to do here,
but I do agree it's going to be a really exciting project. Well, done.
-Thank you very much.
-Thanks very much.
-Lovely to meet you both. Well, done.
So hold that front page as we hope to have that breaking story later in the show.
Ian and Steve are taking on a big, big project, although I think their grand plans make good sense.
But what about the chance it could be listed and will the council play ball?
You can find out what happens later in the programme.
Coming up, I have to keep my wits about me when going upstairs at this Devon cottage.
There are potentially a problem, look how steep they are.
In Kent, work goes ahead without the necessary permission.
Everything we did up until that day was completely at risk, £60,000 to £70,000 at risk.
But first, in Derby, what did these first time buyers make of their tight deadline?
-It was, yeah.
It was stressful.
We're back in Derby where this terraced house sold at auction
for £83,000 to property novices, Kim and Dom.
Been living in this area for about a year.
-So you bought it for yourselves to live in then?
-After we've done the work.
After you've done the work.
Kim and Dom were under no illusions about the task at hand.
They'd planned a total renovation of the place which needed some TLC after years of being let the students.
With a deadline of three weeks until they had to move out of their rented accommodation, the pressure was on.
Did the excitement of moving into their very own love nest spur them on?
Now after ten weeks, we've come back to see how they got on.
The tired looking sitting room has been beautifully redecorated in light, neutral colours.
It was out with the dated fireplace and stonework and in with the contemporary furniture.
They transformed the back reception room and kitchen into a fantastic open plan dining kitchen area.
Before the renovation, the kitchen was very outdated but has now
been completely modernised with brand new units and appliances.
Well, since last time it's changed quite considerably, really.
We knocked the wall through to make it all open plan and there was a doorway there, changed the layout
to make as much use of the space as possible,
took all the old kitchen units out, retiled the floor.
I'm glad that we spent a bit more on the finishings like the sink
and the taps just to sort of give it that really clean, fresh look.
Moving upstairs, the front bedroom has been upgraded
to a stylish master bedroom with up to date decor and fixtures.
The transformation continues in the second bedroom.
It's currently being used for storage.
Along the repainted and re-carpeted corridor to the back of the house now.
The old bathroom has been upgraded
to a very modern look, but ripping it out
was a tough task for Dom.
Well, first of all we took the bathroom suite out, then we took the tiles off the wall,
which was a nightmare because it took all the plaster off so we had to re-plasters.
So that's when we came up with the idea for the inset shelf
which I think looks quite good, and then we bought the tiles,
re-tiled all the floor, took the old radiator
out and put a towel radiator in and then fitted the suite, really.
It looks really modern, nice and light
and we've put the spotlights in as well which makes it a lot brighter.
So yeah, we're really pleased with it.
And so they should be, they've turned this into a beautiful home.
Considering they only had three weeks to get the major work done, it's also been a feat of organisation.
I think that was the difficult bit, trying to coordinate
all the contractors to kind of come at different times.
Obviously one person couldn't start without the other person finishing.
Luckily I had a bit of time off work which was very useful, but Dominic
was still working fulltime and then getting back late...
Evenings and weekends, finishing at two o'clock in the morning sometimes.
-With all the hard work
and late nights did they manage to keep focused?
I think I found it OK, I don't know if you found it a bit stressful.
It was, yeah, it was stressful, but we've come out of it OK, haven't we?
-Come through the end of the tunnel.
Kim and Dom have put everything into this project.
The job has been carried out to a high standard,
and knocking a hole in the kitchen wall was a master stroke,
but has this impacted on their budget of £8,000?
-I think all in all it's probably about ten, ten and a half thousand with everything done.
Which I'm quite happy with really, because we've got such a nice house really, haven't we?
Yeah. And everyone told us at the beginning, you know, don't expect
-to stick to your budget, you will go over.
-So I don't think we've overspent in any area than we could have done.
-No. No, not really.
We probably spent a bit of money on the finishing touches,
-but that's for us to enjoy really, isn't it?
And let's not forget the most important finishing touch for Dom.
-Kim let me have the TV.
And that was about the only gadget I was allowed really, so I was a bit disappointed, but...
Oh, well, at least Dom won't miss any of the Premiership action in this house.
But has it been refurbished to everyone's taste.
We asked to local property experts for their appraisals.
The modern style and feel of the fitments really compliment the size of the house.
The majority of people will like it, will appreciate it.
On balance, the work that they've done is good, it suits the property
and if they're looking to live in it they'll get good value.
The kitchen is very modern, I think opening that up
into a dining area really works, they've got the lounge
to cosy down in the evenings, and two good size double bedrooms.
It stands out from the rest on the street
with having the lovely bright door and bright windows.
The couple bought the house at auction for £83,000 and spent
£10,500 on the refurbishment, so what could it be worth on the market now?
This is a very popular area of the city, it will sell well for between £105,000 and £110,000.
To put this property on the market I'd recommend £115,000.
-We're pleased with that, aren't we?
-Yeah, I'm happy with that,
-definitely. I think we would have made a hefty profit on it.
That's a fantastic result for first time buyers, Kim and Dom.
Not only have they increased the value of their property,
they now also have a lovely place to call their home.
I'm really pleased we did it, yeah.
We've got a house exactly how we want it.
Yeah. It's been a little bit stressful, but it has been enjoyable.
I'm in the south Devon village of Harbertonford.
It's about three miles south of Totnes within easy reach of Plymouth
and Exeter, and that's not all this place has going for it.
Harbertonford falls within a conservation zone
and has also been designated an area of great landscape value.
Well, it's certainly a cute little place so will the property I'm here to see live up to expectations?
Well, it's certainly on a nice little road here
and you know what, it's looking not at all bad from the outside.
It's a cottage, good start, had a guide price of 85,000 quid.
Let's take a look inside.
Sandwiched between a pastel blue and pastel pink cottage, this place certainly scores on curb appeal.
OK, so first thing is, is how high is the ceiling going to be and actually it's not too bad.
You've got this beam going across which gives it a bit of character
but overall it doesn't feel too cramped, which is good news.
Basically one big open space, kind of living room area there, and a kitchen which is obviously kind of open plan.
Given the size of the little cottage I actually think this is a very sensible way to go
and the units themselves look fairly new, so we like that.
What we don't like is this wall here.
Now this is a fairly significant wall in the property and as
you can see there are lots and lots of indications of damp.
Damp coming down, all sorts of mould and stuff going.
Look at that. Yuk. And being such an old property that could be
kind of expensive and difficult to sort out. Hmm.
Any potential buyer
will have to make finding the source of this damp their first priority.
But what else is on offer?
So upstairs and before I even go up them I can see these are potentially a problem. Look how steep they are.
If you were to build this place you'd never get building regulations for stairs like this.
However, I don't know if there's
any options in terms of how else you could have these.
You're going to lose more space and there really isn't the space in the cottage to accommodate an alternative
so they're pretty much going to have to stay as they are.
But come up here and more indications of the problems
with this particular wall and I am a little concerned because this is a
fairly major beam in the property and because it's going into the wall, you can see again, completely damp there.
It's actually causing this beam to rot.
That could be very serious and it's not until you start taking
this wall apart you're going to discover quite how bad that is.
But up here, two tiny bedrooms but,
you know, reasonably light and airy which is quite surprising,
but helped by these roof lights. Bathroom is up here
which is good, and it's not a bad size.
And you know, I like it, it's got some problems, but I really like it.
A real mixed bag here then.
There's plenty of charm and character,
but if you took this on as a renovation project
goodness knows what you would uncover once you start investigating those damp walls.
Sadly there's no garden attached to the cottage, but this isn't where the property ends.
One of the issues you have with cottages like this is storage space,
however the good news is that the property does come
with a bit of additional storage, one of these things here, kind of like a little cavern.
You could use it for wood, your bike, a bit of coal or whatever.
So all is not lost.
So it's a quirky and appealing little cottage,
but does a local property expert
think its charms can override the problems?
This particular property, very small but very cute.
It needs modernisation, refurbishment from top to bottom,
but could be a lovely little
property, starter property or investment for letting.
Once the work is completed to a good standard,
what could the re-sale value be,
bearing in mind the guide price of £85,000?
Once renovated I would expect the property to be put on the market for somewhere in the region of £125,000.
Harbertonford is a popular place to live so what sort of rental could this place earn?
Once the property was renovated and if decided to be let out
you could achieve probably £500 to £550 per calendar month.
Well, properties in this area don't come cheap, but there is a reason for that, it is a lovely place to live,
and here's your chance to get a characterful place for not too much money.
Let's see who fancied it when it went under the hammer.
Lot 38, character two bedroom, two-storey, mid-terrace cottage,
who will say to us 75 and we'll kick it off?
75, who will say it? 75? Nobody want it at 75?
75, thank you, 75.
That's the way, that's how it works. At 75. At 75.
At £75,000 then for the first time.
At £75,000, 78 on the right. At 78, at 78, at 78, at 78, up to you.
At 78, 80, at 80, at 80, at 80, like tennis, at 80, 82, 84, 86.
86, now it's gathering pace.
Say 90, blow him out of the water, look, that's the way.
88? 86 I've got then.
86, at 86, at 86, at 86.
OK, looking left. 87, 87, 87, 87.
At 87, 88 or not?
87 first time then.
At 87 second time.
At 87, are you sure and done? Last chance then.
At 87, you're up, 88.
Oh, hell's bells. 88, did you get that?
You got that, 88. At 88, at 88, at 88, at 88, don't scowl at me, it's him over there that's caused this.
At 88 once, at 88 twice, at 88, here we go, third and last time,
here we go, are you all out? At 88. Sir, well done, 88.
The successful bit of £88,000
came from friends Mike and Nathan who both live in the village.
Mike has retired from the oil industry and Nathan's a builder.
They've recently teamed up to do some property developing together and this is their first joint project.
-Good to meet you both. Congratulations.
-Cute little cottage.
-That wasn't that enthusiastic! HE LAUGHS
-There's work to be done.
-There is work to be done, but why did you want to buy it?
Partly because it was so close to us as a first project. We kind of knew the history of it and knew what was
needed to be done and Mike did the research on what it was worth and I
-left it to him after that.
-We've been thinking about it for some while and with it being
on our doorstep it just made sense to go for it.
Tell me about you two and the collaboration, what's happening?
-Well, we've been friends for, I don't know, five or six years?
We're neighbours for a long time, we get on really well and we've talked,
I've talked about doing up something for a long time, I've been building
for a while now, but couldn't afford to do it on my own so we kind of formed a collaboration.
And I retired at the end of last year so I needed something
to keep me off the streets so that's how it all kicked in really.
If Mike's looking for something to keep him out of trouble he's certainly got his work cut out here.
Mike, tell me exactly what you're going to do to sort this place out.
OK, well the biggest issue is the damp in this wall at the back, rectifying that situation.
Once we've overcome that it's just a case then of going through the place, sprucing it up.
I don't think there's much more will be needed to bring it up to a reasonable level.
So what's the budget for the works?
-We think about ten.
-Ten we were working on.
Hopefully we'll get everything done in that, hopefully it will be less than that, but you never know until
you start raking around in the wall what you're going to find.
And the timescale?
-Well, if I say two weeks I think that will be pushing it but I think that...
Yeah, I reckon we could do all this wall fairly quickly and then spruce it all up.
-But I think we'll say a month.
It's just as well Nathan has got experience in the building industry
as that's a tight timescale and I'd be very nervous about what's lurking under those damp patches.
That could affect the budget and the schedule and,
of course, there are more quirks in this property that need looking at.
Now what about the stairs, because they're not ideal but I can't
-necessarily see a way of improving it given the size.
Because we're just renovating we haven't got to comply with the building regs.
If we did we'd have to move and make a bigger hole here and
you'd lose landing space and then you'd lose space down here as well.
Somebody suggested a spiral but there's not enough room for that
-really so I think they might have to stay as they are.
-Which is a shame.
As this is an investment for them, their first thought
is to sell the cottage when the work is finished,
but they're also open to the idea of renting it out.
Well, we thought it would bring a reasonably good rental income.
We know the previous people who were renting it, we know the rent
they were paying for it even in this condition.
-What was that?
So you know if you rented a place in this condition for 500 then there's some rental value there.
And how is it going to work financially between you?
Have you bought this jointly, are you going to share any profits?
-So that will be the formula
-Yeah. We'll see how we get on with this
one and then hopefully we'll do something together again.
-Well, listen, good luck with it all, we wish you all the best.
We look forward to see how you get on.
-Well, I think Nathan
and Mike have chosen well for their first project together and they are under no illusions that the big issue
here is that main wall and all the damp issues therein.
What are they going to unearth when they start digging around?
You can find out later in the show.
So, did our fearless developers emerge victorious?
Or did they flounder in the shallow end of the property developing pool?
Let's find out!
In Sittingbourne, Kent, right on the High Street were the old offices of the local newspaper.
With the journalists long gone there was just a large, empty space left.
But local lads Steve and Ian thought the place was right up their street and bought it for just £150,000.
What are you going to do with all this space?!
The shop downstairs has to stay as a commercial property so that has to stay as retail, but
we're going to convert it if we can get it through
planning, turn it into flats and we should, fingers crossed, get five or six flats here.
It's three two bedders and three one bedders.
Eight months on, have things gone to plan?
By the looks of it the small shop space is now occupied
and bringing in money, but what about the large office space?
Well, there are signs things have changed, though not quite in the way I had envisaged.
It looks like it's gone from press to press ups.
And from flats to fitness.
How did that work out? What's the story here?
We need Steve and gym owner Shelley to give us the headlines.
Well, since last time you came, the idea was to convert the whole building into flats.
After we started going through that process, I actually joined a gym, met Shelley.
Steve's very like-minded business-wise and I explained to him I was looking for a bigger premises.
And I just said, I've got a place that might be perfect for you, she
came down and had a look and it's all spiralled from there, really.
It was perfect because we just worked together, rather than me going and finding the building and then having
to change it to make it suitable we worked with each other trying to you know, saying what I thought
was best and obviously what could be done building-wise.
So we just changed over to that, so we changed design, went back to the
architect, re-laid the areas out and ended up with what we've got now.
That seems to be the ideal solution for both parties in the short term
but in the long run, Steve hasn't given up on the idea of flats.
These are the plans the architect came up with.
After we obviously won the property, we gave him the originals and he then split them up into seven flats.
We ended up with two bedsits, I think it was one or two single bedders and some two bedders.
And what we basically did was after this was designed and we decided to go for the gym option, we used
this as a blue print and from that blue print we could work out where the structural openings were
going to be, where the structural alterations were going to be and then use them for the gym layout.
As the kitchens and showers are now in place, should they go for the
flat option at a later date they'd be able to hit the ground running.
They also made a headstart on the gym, but that meant taking quite a gamble.
We didn't actually get planning application approval until two weeks before she was due in,
so everything we did up until that date was completely at risk, which was a big risk.
You know, we've put in £15,000 worth of air conditioning.
All right, the roof maybe had to be re-done anyway but all the
structural alterations, a lot of the structural support works, so we've probably spent 60, £70,000 at risk.
Until we got that final bit of paper from the council saying
yes, you have the approval, that was the risky bit and there were a few sleepless nights, but not too bad.
-I didn't bother telling Ian.
Speaking of Steve's business partner Ian, where is he?
Regarding my business partner, Ian, he's more of a silent partner, shall we say.
This is my expertise, I've got my own building firm, this is what we do day in, day out,
so he's basically prepared to go along with whatever I say.
He's more the finance guy really, he's more on that front.
So I bang ideas off Ian like rent incomes and stuff like that.
Regarding the construction, the cost of the build, Ian really didn't care
it was just a case of, you just do it, let me know how much I've got to pay and we'll go from there.
So the only working out Ian was doing was on the figures.
But how many pounds did Steve rack up?
Initially, probably about 50, 60K to do the conversion.
With engineers fees, architectural fees and everything else we're probably looking at all in about the
110 mark, something like that we've spent on the building.
They paid £150,000 for the building and that £110,000 budget takes their
spend to around £260,000, but it's already paying its way.
Rental return we're looking at on this premises, we've basically got
the gym upstairs which we've agreed our contract for 40,000 a year.
And then we've got the shop downstairs as well which we've
been able to sell self-contained which is rented out separately.
We're probably getting 44K here for the whole unit.
£44,000 a year from a total investment of around £260,000.
Keep that up and the building will pay for itself in just six years.
What does a local commercial property expert think about what Steve and Ian have achieved here?
I think it has been excellent that an investor has come in and been
able to put in a gym and get an immediate return within one year to such a high extent.
Steve and Ian have invested around 260,000 in this shop and office space.
Has converting it to a gym enhanced or decreased the value here?
When we look at now we've got rental income coming in from two different sources, a gold shop, retail outlet
plus a gym which is a long-standing business, so it's not a new business
coming in, the values can quite easily double to 400 to 450.
But is this really the way forward?
Are they missing out on a bigger payday if they took the option to turn it into flats?
In terms of one or two bedroom flats we're looking at between £46,000 to £50,000 coming in and this is
achieving slightly more with one tenant rather than having to deal
with seven tenants, and a business person which I think is excellent.
So the building has increased in value,
it's bringing in a significant income and Steve and Ian could still turn it into flats at a later date.
That's a good news story if I ever heard one.
We were lucky finding someone who wants to use it as a gym, obviously,
and overall Ian and myself were really, really happy with this return we're getting on it.
And you have to say, in these tough times if you have the opportunity
to get an investment working for you immediately, you'd be daft not to jump at it.
We've returned to Harbertonford near Totnes in Devon.
This two-bed mid-terrace cottage had sold at auction for £88,000
to friends Nathan, a builder, and Mike who's retired from the oil industry.
The major problem was the serious damp affecting the back wall
and the A-frame beams resting on it which had started to rot.
But despite all this, the pair were pretty confident about how long the work would take.
-Well, if I say two weeks I think that will be pushing it but I think that...
Yeah, I reckon we could do all this wall fairly quickly and then spruce it all up.
-But I think we'll say a month.
So, not two weeks but two months later, what's the update?
If these walls could talk they might be saying, phew.
It's looking much better, but eight weeks on the house is still not finished.
Some areas have been prepared for decorating but a new
kitchen and bathroom have yet to be installed.
To be fair the timescale stretched, because Nathan was finishing another project,
but was that damp a bigger problem than they anticipated?
Well, there were a few scary moments when I opened up the ceiling downstairs because there was a
big bulge in the ceiling downstairs and I opened it up and I thought
oh, my God, because all the joist ends were all rotten
and then I found out how much damp there was in the wall because the paint was hiding a certain amount.
So there was definitely a moment where I thought oh, my god, this could be the money pit.
Probably easier to make a water feature out of the wall,
there was that much water coming down, than to try and repair it,
but that's not what we're here for, so we've now
done all the major work, all the fundamental works and the wall is drying out quite nicely.
Tracking down the source of the damp was the first job for Mike and Nathan.
That led them up to the skylight and onto the roof.
The old television aerial on the chimney had split the render over many years during bad weather.
Well, we've had to redo the chimney, because this was the main problem.
It was leaking like a sieve, water going all the way down through.
So we took everything back to basics.
We took all the render off, we took off the top of the chimney and I've had to put new lead in,
in certain places to try and stop water coming in.
And then we've re-rendered, built a new chimney pot on.
Underneath this section here where the new chimney meets the old existing chimney we've got a big
sheet of lead now so any moisture that does breach here should drop off so that's hopefully fixed it.
Now the source of the problem is fixed their attention has turned to those beams.
Well, the beams are rotten on the ends, the A-frame beams.
Two of them aren't too bad so we'll just put a new piece of timber alongside them and just make them
look like one big chunky one, build them into the wall so they'll be structural, they'll be fine.
The main one in the middle needs a bit more.
I think we'll probably put steels alongside that one
because it's got to support the main structure of the roof.
Structurally the cottage is definitely on the mend, so now they can concentrate on the interior.
But what about that steep staircase?
They've investigated building a new stairwell in line with modern
regulations but at £1,500 they want to finish the rest of the property before deciding if it's worth it.
Mike is keeping a tight hold on the purse strings.
I look at things and say, I'd like to do that, and Mike says, I don't think we need to do that.
So it does help having somebody else's ear to sort of rein me in a little bit, yeah.
Well, at the end of the day we did a great budget and from time to time it would be nice to do
a Rolls Royce job. Unfortunately when you're working within a budget then that's
not always possible, but he does like to do quality work so we have to tread on his fingers sometimes.
Good for you, Mike, reining Nathan in, but it does seem the collaboration is working.
Yeah, I get stuck in, he stands there looking at me sometimes
because he's not sure, obviously he's not from a
building background, but I don't do the finances,
Mike does the finances side so yeah, we work well together.
With the renovation well underway and the team functioning, let's hear how the finances are going.
We budgeted 10,000 to rectify the place, that's without our time.
We've spent so far 4,500.
We've got one or two things that we need to buy still so it'll bring us up to around the £7,000
which will still leave us a few shillings in the pot if we need to do anything else.
Looks like Mike's got it all under control.
Now we need to find out if the work they are putting in will translate into a successful investment.
We asked along two local property experts to hear what they thought.
This type of character cottage will have an immense appeal to many different types of buyers.
It could be people looking for a second home, locals who
need a first purchase, or indeed buy to let people.
It would sell brilliantly. There is a lot of demand for character cottages,
the village is a popular village, it's got a thriving community.
Cottages like this in the area are very popular for professional couples.
It's commutable to Plymouth city centre and obviously a
lot of towns in the vicinity, so professional couples are going to be the main marketplace.
The property needs a couple more weeks of work
to complete the renovation so Mike will need those extra pennies.
But what about the staircase? Could a new one add value?
The stairs were an issue and I must admit by moving them it would help and make it easier to obviously
access the first floor. However, by the cost and involvement and time it's probably not worth doing.
Well, that's one saving to be made then.
Let's hear about re-sale values.
Mike and Nathan estimate a total spend here of £98,000 including their 88 grand purchase price.
What could it be worth?
Once the property is fully renovated to a reasonable standard you could
expect to achieve somewhere between £120,000 and £125,000.
If I was to market the property in the finished condition with a lot of
character, I would be looking at a figure of between £145,000 and £150,000.
I think the first one of 120, 25 was probably the figure we've been
working to so the other one is a very pleasant surprise.
Yeah, that's good to hear the higher one.
There's quite a bit of room for some profit hopefully there.
Come on guys, don't get too excited! That is a pre-tax profit of £50,000.
That is good. We haven't sold it yet.
You don't count your chickens do you, until they've hatched!
The other option would be to put it on the rental market.
Two bedroom cottages, especially in these sort of backwater locations,
would fetch somewhere between £600 and £650 per calendar month.
We'd be looking a rental of, say, of £650 per calendar month.
-I think that's pretty good.
-It's probably slightly above what we were thinking so that's good.
The effort they've put in to their first joint investment project is clearly paying off.
So are they planning to do another renovation together?
Yeah. I would happily work with Mike. We've done very well.
If he asked me nicely, I'd consider it. Yeah, I'm sure we will.
Yeah, we work well as a team. It was good.
Not enough for you? Well, there's plenty more.
Join us next time for more Homes Under The Hammer.
-We'll see you then.
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