Episode 9 Homes Under the Hammer

Whether you're looking for a "do-er upper" or a plot of land...

An investment property or a place to live...

..you can find them all at the auction on Homes Under the Hammer.

There are several key things to remember when buying at auction.

Do your research and sort your finances out in plenty of time.

So did today's buyers do their homework?

This Victorian villa in Derby is enchanting, but the period features seem to have vanished.

Just bring back the magic of this property.

In South West London, I discover a flat that's just perfect for trainspotters.

The flat...

the railway line.

And this two-bedroomed apartment in Sunderland has all mod cons

and running water... But not where you'd want it.

I mean, look at that. That's not good.

All these properties have been sold at auction.

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

-Sold!

I'm in Derby in the East Midlands.

It's the heart of England, which means it has excellent transport links to the rest of the UK,

and East Midlands Airport is only about 15 miles away.

Derby's real boom time was during the Industrial Revolution in the Victorian era, so it's

not surprising there are a lot of Victorian two-up, two-down terraces.

But there are also grander properties such as

in Belper Road here, where up for auction was a Victorian villa.

Six bedrooms, had a guide price of £155,000.

It looks pretty grand from the outside, and it seems some initial renovation has already been done.

There's also a new blockwork drive and path, which is a bonus.

The house forms part of this larger block of houses, which at some stage

in the past were knocked together to create a large care home.

Now, at some stage more recently they've actually re-converted back into individual houses.

Work has commenced, it hasn't been finished, so let's find out what it's like inside.

Ah, there you go...

Bit of a clue as to the previous use of this property.

Obviously this was an adjoining door through to the other houses in this block here.

It's been blocked up now, but it's left you with quite a lot of damage to repair,

especially the skirting board. That is beautiful.

Those classic 9-10 inch skirting boards, so Victorian.

You'd want to put the same thing back.

You're either going to have to go to an architectural salvage place

or get a bit of a specialist company in to replace that as it was.

While I'm on the floor, look at these beautiful Minton tiles.

Again it's going to take a bit of a specialist to sort those out.

But definitely worth doing.

You want to try and just get some of the magic of this house back.

You've got big rooms to work with, but they've been messed about with.

Somebody's put these odd walls in there.

They've taken out the original wall from there.

And it's ruined the flow that these houses really have.

Fireplace... I mean, for goodness sake, I suppose this was a care home,

so fireplaces weren't important. But you want to put

a lovely old Victorian fireplace back there.

Basically, just bring back the magic of this property.

At the back of the house is another large reception room, and along the corridor, a downstairs toilet.

Further along, a room that was once a canteen.

There's also an office.

If all these rooms were knocked together, there'd be space for a good sized family kitchen.

But all these corridors make the property feel rather institutional.

One big disappointment with the property, unfortunately, is here at the back.

It is a disaster. You've got this area here where there's obviously been some kind of outbuilding.

And then the garden, well it's just a concrete slab.

There's no access really at the back, apart from a pathway.

This needs to be a beautiful Victorian garden.

As it is, it's a car park.

Back inside, on the first floor there's a family

bathroom that needs upgrading, and three more spacious bedrooms.

At present these are all stripped back to bare walls, and need a great deal of attention.

Up here in one of the bedrooms you can see,

fairly horrible, a door from the days when this was a care home.

Obviously you want to replace that with something a little more in keeping.

This partition wall, again the layout of the room has been changed completely.

You want to think about that, but the partition is not going to be difficult to get rid of.

When it comes to the windows, these are actually fairly new.

They're double glazed.

However, as you can see, they are not that pleasant.

They don't fit in with the house.

And as it turns out, legally there is a stipulation that whoever buys this property

has to replace these windows with something more in keeping.

Sash windows, wooden ones, still be double glazed, whatever.

They've got to look better than this. Thank goodness!

# I don't really want you, I don't really need you.

# I don't want to have you I don't really love you... #

Returning inside, and on the second floor things are looking a lot better.

There are signs that the previous owner had already started to renovate this part of the property.

Up here on the top floor, three more bedrooms, although one of them is fairly small.

At this point you could be thinking, why not convert this house into flats?

Well, apart from being a great shame, you can't do it legally.

The legal pack stipulates that this can't be converted back into a care home, it has to

remain for residential use, and it can't be converted into flats.

If you bought this place thinking, I'll convert it into flats,

and you hadn't read the legal pack, you'd be in trouble.

So, always read the small print.

This spacious house with its six bedrooms, one toilet, bathroom and no apparent kitchen,

is going to present the new owner with a huge challenge.

I asked the auctioneer who sold it for his opinion.

We're on the north side of Derby,

just half a mile from the city centre.

In a very desirable area.

These were very fashionable houses some years ago.

I think as a single house it's got very limited rental prospects.

Not very many people want a six-bedroomed house, unless they've got a very large family.

When renovated as a single family residence,

on today's market this would probably have a valuation of around £275,000.

It would be easy to get carried away and spend around £100,000 renovating this place, restoring the original

period features and bringing it back to its former glory.

If bought for close to the guide price of 155,000,

and renovation costs were kept low, that valuation of 275,000 could still mean a decent profit.

Well, you can see what a grand old place this once was.

But you can also see the amount of effort it's going to take to get it back to its former glory.

So, who was willing to take on the challenge when it went to auction?

Six-bedroomed accommodation.

Start me on the guide at 155.

150,000? 150, may I say?

150? 150 I have.

At 150,000, thank you.

Who'll raise it by £1,000?

At 150... Opening bid, 151.

152 is bid. 152... 153. 154.

154 and five. 155. 156 in the middle.

156. 157 on the right. 58 is bid.

158. 159.

160. 160,000... 61.

Seated bid, 61.

162. 163.

64. 165.

166.

166 and seven. 168.

169.

170.

At £170,000 for the first time...

For the second time...

Out on this side, no mistakes. Third and last time, all done at £170,000!

Sold, sir. It's yours, 170.

Thank you.

IT worker Nick and his partner, Cath, an accountant,

bought the property for 170,000 - 15,000 over the guide price.

They'll have their work cut out to make this into a comfortable home.

While Cath looked around, I asked Nick why they needed such a huge property.

Well, there are five of us at the moment, and I've

got another couple of children that don't live with us but come to visit.

It's impractical, the house we're in.

-Did the state of it put you off at all?

-Eh...

No, we knew what to expect, really.

So tell me what you're going to do to it?

I'm going to try to put it back to its original state.

Knock out a lot of walls, recreate all the big rooms that it had.

Knock all the back out, create a big kitchen there.

Just get it back to the state it would have originally been in.

Who's going to take it on? Who's going to do the work?

A combination of us and contacts.

Some of it we can do ourselves, but I'm not going

to run in a gas supply or rewire the house, or that sort of stuff.

For Nick and Cath, this will be their

first major renovation project, and they have ambitious plans.

But they're going to need a lot of cash to make them work.

How much have you set aside to sort it out?

Between 70 and 100.

Oh, wow! A realistic budget.

Well actually, a very big budget.

Well, we're hoping to do it for the bottom end of that.

It just depends what needs doing, really.

We don't know if there's lots of surprises waiting for us when we start knocking it about.

So what about a timescale for the work?

I'll probably start in about six weeks, and would hope to have the house habitable within six months.

Not finished. The idea is to move in whilst it still needs work.

And then hopefully have it done within about a year.

So listen, good luck with it all. Congratulations.

I really look forward to seeing how you transform it back to its former glory.

Or as close as we can get it!

Well, Nick and the family know they've taken on a major project here.

And although they've set aside a very reasonable budget, I think it

won't be long before that 70,000 quid is spent. It's a big house.

And once you start putting back the original features it's crying out for, the cash will soon go.

Anyway, you can find out how they get on bringing this glorious place back to life, later in the show.

I'm in Colliers Wood, South West London, an area with the dubious honour of being home to this.

According to a BBC poll taken a few years ago,

the disused Colliers Wood Tower is London's most hated building.

Let's hope our property is rather more pleasing to the eye.

The property I'm here to see is slap bang between Colliers Wood and

Tooting Broadway Tube stations, and a short walk from each.

So, in 30 minutes you could be living it up in Leicester Square, or busy in the City at Bank - perfect.

Now the property itself is this 1940 end-of-terrace.

It's a flat with four rooms, kitchen and bathroom, and it's got a guide price of 130,000.

But there's something else you don't know.

The flat...

the railway line.

Oh, dear. It all seemed so promising.

I am disappointed.

The railway line couldn't be much closer.

Noisy neighbours are a common enough problem, but a rail track so close to your property takes the biscuit.

The road out front is pleasant though, and at least you have your own front door.

So let's start by getting that fake leather screen out of the way.

It doesn't really bode well.

So we're upstairs in the flat, and to the front the property

you've got three rooms - two fairly good size and one box room.

Now at the back of the property you've got what would have been the living area.

And straightaway I'm walking into a room that's incredibly small.

It doesn't feel spacious in this flat at all.

You can tell somebody obviously took care of this property.

But it's just extremely dated. It's old, it needs modernising.

I mean, look at the wallpaper.

Polystyrene tiles up here, which are a fire hazard.

You've got an old fire here with an old fire surround.

It all needs starting again.

So for me,

it's not a great start.

The configuration is odd, to say the least.

As this is a maisonette, these flats would have been designed this way,

and not be the result of a later conversion.

This room is a very good size. If you removed those cupboards, there'd be even more space to play with.

The little pink box room is just that, but convertible into an office or nursery.

The middle bedroom seems to be something in between.

But where's the kitchen?

Hello! Now you could be forgiven for thinking you found me in a cupboard!

But no, this is the kitchen, or kitchenette. A bit small.

I don't know what you'd call it apart from utterly inadequate.

And to top it off, the bathroom is next door.

But at least you can check your spuds aren't boiling over while you're having a bath.

Bijou, snug and cosy are terms that could describe this flat.

But I can't help feeling a bit boxed in.

# I'm-a living in a box, I'm-a living in a cardboard box

# I'm-a living in a box. #

To create some space, relocating the bathroom into the box room would be an ideal solution.

But it's a big job when you contemplate the plumbing needed.

I'd certainly get the kitchen out of here, and put it where the lounge is.

But to do that probably means losing another room, since you'd still need somewhere to sit and relax.

So it's all a bit of a compromise once you start thinking about it.

But when it comes to compromises, that garden's in a league of its own.

So you've had a hard day in the city,

the sun's out, you want to relax in your own private garden - perfect.

Well, not quite - because of that!

It's not the busiest line, granted, and you can expect trains every 15 minutes or so.

But that's just enough time to sit down, glass of wine in hand, doze

off - only to be rudely awoken by the clattering of the 18:32!

That's not the best way to relax now, is it?

The new owner of this property may wish that the trains didn't run on time.

And the impact of the railway doesn't end here.

So how's the view from the front window?

Train track.

Oh, and what about the middle room?

Train track.

And finally, the living room.

So, go on, I bet you never guess what's behind this curtain - go on, guess? Leaning Tower of Pisa?

No! The train track!

I hate to say it, but I can't shake the feeling of being surrounded.

The garden could be lovely, but with a view only trainspotters could love, it's a bit of a letdown.

To get an independent opinion, I invited around a local estate agent to see what he thought.

'I don't think there's much you can do to change it around.'

It's not got a big footprint to do anything fantastic with it, or exceptional.

But what I would do is move the kitchen from where it is,

bring it forward into the room before there,

and maybe turn that into a small utility room out there.

Also, it gives you room to maybe expand the bathroom a little bit, which is a little bit small.

But generally, the rest of the flat is a good size.

'It looks in good condition, it just needs redecorating.'

I think the property will rent, but once again it will be subject to price.

I think you're looking at realistically somewhere between

750 per calendar month to 825 per calendar month.

As I see the property today, I'd value it at around the 175, 180 mark.

It possibly could be worth, after work's done to it, up in the early two hundreds.

200,000, 205, 210,000, depending on what's done to it.

Well, there's no getting away from it - this place

is in a bit of a state and needs some serious reorganising.

And that train line is loud.

But I still think this flat could be something to shout about.

At that guide price and in this convenient location,

if you're careful it could be a fast track to a good profit.

Let's find out who spotted it at the auction.

Colliers Wood now, Lot 30.

A four-room purpose-built flat.

Start low, 120.

120 anywhere?

Thank you, 120.

125?

Anyone else?

120, first time... Second time...

Third and last time...

135, madam?

140.

145.

150 on the phone.

151...

It's going at 151...

First time... second time...

Third and last time... 152.

152 to the phone, first time, second time, third... 153 in the room.

153 in the room.

First time, second time...

154.

155.

155 in the room.

First time, second time... Third and last time...

Have you all done?

156, aren't I?

157.

157, sir. 157. 158.

157, first time, second time...

Third and last time - have you all done?

Sold, 157. Well done.

Hard luck, the telephone.

That winning bid of 157,000 came from Basim.

Originally from Lebanon, he now lives in Surrey and works as an oil and gas engineer.

Buying property is a brand-new venture for him.

So, what are his plans for this Colliers Wood flat, and more importantly, does he like trains?

What did you think when you first saw the train line on your viewing?

I thought it might be a problem.

But the estate agent said it'll put some buyers off, but it won't put everybody off.

It's not like a big bad thing, because he said

you get used to the trains. There were people living here,

and there will always be people living beside the train lines, in all the other houses.

Therefore, you'll find some buyers that will compromise and say,

"That's OK, we've got the windows, for example, for extra light."

How did you find the auction? A little bit nervous, were you?

Nervous, yes. Very nervous, actually.

It's all coming out, the truth! So, tell me how you were feeling while you were bidding.

I wasn't going to bid.

I went there thinking that I was just going to test it and experience the whole auction.

But, then, the price was going for quite cheap compared to what I thought.

I held my hand up, and then another one bid against me.

It went up, up, up.

I thought no, then yes, then no.

Then I came up to 157, and then nobody bid over me.

Then the hammer stuck down and I took it, so I was quite shocked, thinking,

"What have I done? Did I make a mistake?"

So, what are you going to do, Basim, to really make this flat stand out?

The bathroom, I'm going to make it bigger.

And then the kitchen, get rid of it.

And move it in here, to the lounge.

And then the other lounge stays as a lounge, and there will be a bedroom in the bedroom.

Redecorate all the bedrooms, paint them, get rid of the ceiling which is polystyrene right now.

And these tiles.

Yes, all these tiles. Rewire it all, because we've got to rewire, because right now I think it's illegal.

And do the plumbing. And then put central heating system everywhere.

How much money have you got to spend on all this?

At the beginning, I thought it was going to be £10,000.

-But I think that's wrong.

-I think you can at least double that.

Yes. That's what the builder said, he said between 15 to tops 20.

So, you've purely bought this flat to make money, Basim?

You've got to be extremely careful about your budget.

You can't let it run away.

-No.

-Are you already feeling slightly bogged down by all the choices and all the decisions you have to make?

-Not slightly, a lot, actually.

-So you're feeling quite bogged down at the moment?

-I am, yes.

Because I work full-time, and then I've got to do all this other stuff,

and obviously I've got to finish it on time so I can sell it.

Because I got some help from my dad, actually, with this flat.

So it's kind of critical, and he wants to see some profit too.

So he wants his boy to be phoning him up at the end of the day saying,

"Dad, I've just made loads of money on this flat in London."

Exactly.

Basim, good luck with this.

-You've got a lot of hard work ahead, well done.

-Thank you very much.

-Thank you.

-Nice meeting you.

The pressure is on for Basim to turn a profit here.

But if he does his sums, well, this flat could just be the ticket.

But will he be able to keep his eyes on the builders, will his first development go off the rails?

Well, you can find out later on in the programme.

In Sunderland, this two-bedroom flat looks too good to be true.

And it is.

That would put a lot of people off.

We return to south-west London to see if things are on track for this novice developer.

For one month it was very, very difficult and very busy.

But first, we reveal the secret of design harmony.

The colour scheme was a joint decision. Kath picks it and I agree.

We're back in Derby, where local couple Kath and Nick paid £170,000

for one of these houses, which had previously formed part of a care home.

It was going to take a lot of effort,

and a serious budget, to bring this place back to its former glory.

How much have you set aside to sort it out?

Between 70 and 100.

Wow! A realistic budget.

Well, actually, a very big budget.

Well, we're hoping to do it for the bottom end of that.

Well, a year later, we've returned to see how they fared turning it into a home.

Needing lots of refurbishment and modernisation, this three-storey late Victorian villa

came with six bedrooms and space for a sitting room and dining room.

There was a family bathroom in pink and chocolate, not everyone's favourite colour scheme.

And a back garden crying out for some TLC.

Well, the first time I saw it, I thought, "It's a bit of a tip."

But it's just the size.

I had a look round and thought there was a lot of work here, but it

wasn't structural work, it was more cosmetic, really.

-To be honest, we just fell in love with it, Nick.

-Well...

But the price of love can be steep.

Even with a reasonable budget of between 70 and 100,000,

it was going to take a lot of effort to turn this near derelict interior into a comfortable family home.

Our kids have been a big help.

They came in right at the start and did a lot of the hard physical work

of knocking down doors and taking the rubble out and everything.

And then they've come back in later and helped with the decorating.

The colour scheme is a joint decision.

Basically, Kath picks it and I agree.

That's the way it tends to work out.

Nick, Kath and their children had hoped to move in after six months.

And then to complete all the work within a year. So, how did they do?

Well, they bought the house without a survey, and have had to completely replace the roof.

All the rooms have been re-plastered and painted.

And the vintage skirting boards have also been restored.

The skirtings, what we did was chopped out an original piece of the skirting and took it down

to a local carpenter, who then had a mould made, and ran off

100 metres or whatever it took.

New doors have been fitted throughout.

That helps remove any lingering institutional feel after its days as a care home.

The house has been fully rewired and replumbed, which unfortunately gave them their biggest headache.

So this is the master bedroom.

It was originally two rooms, but we decided we wanted an en suite, so we knocked through into this room.

This is where we encountered a problem with the plumbing.

But there's a big steel girder across the front of the house, which meant we had to run it round

this way, and make the appliances fit the plumbing.

Which left us with a little bit of a problem getting into the shower.

But generally, it's good. It's a good bathroom, we like it.

The main family bathroom on the first floor has been thoroughly

modernised, with stylish new fittings.

There's new flooring and carpeting throughout.

And the fireplaces have been reinstated in

the ground floor reception rooms to complete the homely feel.

But the piece de resistance is undoubtedly the brand-new kitchen.

Kath's pride and joy.

This is the kitchen.

Originally, it was a corridor and two rooms.

We've taken the dividing walls out, so now we've got a kitchen that we really like. It's big.

We've got the cooker that we really love.

We brought a lot of the stuff with us from the old house.

We've sort of fitted it into how we like the kitchen to be.

It looks like they've spent most of their renovation budget.

Yet there are still some areas needing attention.

We've spent about £75,000 so far.

But we reckon there's a bit more to come.

The work left to do, really, is the hall and stairs.

Sorting out the floor in the hall where there's a bit of damp.

Getting the stairs stripped down and repainted.

Carpeted. That's the main part of the work.

Then there's the garden which is just going to have to wait.

With that damp in the hallway, what's happened about those beautiful old Minton tiles?

The Minton tiles are quite badly damaged, but luckily, our neighbour had an identical

which he's taken up, so he's given us all his old tiles.

So we reckon, between the tiles we've got and the tiles he's given

us, it should be possible to restore it back to its original condition.

That's good news. But remember those awful modern windows?

As they're in a conservation area, they were replaced with double

glazed wooden units, more in keeping with the surrounding properties.

Nick and Kath have taken great care to turn his back into a really elegant home.

So, has the money and time spent been a good investment?

We invited back the auctioneer who sold the property to them,

and another local estate agent, to give us their opinions.

I'm really impressed. It's a lovely house, anyway, lots and lots

of character to it as these old Victorian town houses used to have.

But he's put it back into a single residence, lots of space. Really appealing.

They've certainly retained many of the original features.

I noticed the original tiled flooring in the hallway,

and the wooden sash windows at the front

of the property, which is in keeping with the conservation area.

They bought the property for £170,000,

invested £75,000 on refurbishing it, and plan to spend another £5,000 on the remaining work.

That's a total of £250,000.

Could they hope to see any profit if they were to sell?

I think he's done an intelligent job

in altering the accommodation to what it is now.

It works as a family house.

-It's good.

-It's certainly an eye-catching property.

It's presented over three floors, really high ceilings, so it's got

the wow factor when you walk in.

On today's market I think it would probably achieve something in the region of £275,000.

I'd value this property at between £275,000 and £295,000.

That's a potential pre-tax profit of up to £40,000.

Are they at all tempted?

We've done this really because we wanted a bigger house, we haven't looked at it as an investment.

We haven't looked to make any money out of it.

It's good that it's held its value and we won't lose anything out of doing it.

It's our home.

The value has held and

I think it'll probably go up in value as the market changes.

So, it's good that it's worth more than we've spent. It's not easy,

but you survive

and it's worth it in the end. And it is good fun.

I'm in Sunderland in the north-east of England at the mouth of the River Wear.

Once known for its shipping industry, the area is now famous for a different reason.

Technology-friendly Wearside now has more digital TV viewers than anywhere else in Britain.

Apparently.

Well, the property I'm here to see is in the middle of this techno-mad community.

It's in this building here.

Hammerton Hall, which used to be a hospital in the First World War.

It's a two-bedroomed flat at a guide price of £55,000.

The big question is, will it need emergency surgery or be fit and ready for discharge?

Hammerton Hall has been extensively modernised, and is now made up of eight privately-owned flats.

More important, though, is the fact that in 2007 this flat sold for £170,000.

That's an amazing 115,000 more than the guide price it went to auction for this time round.

Nice room. I love the shape of this, I guess

that's what you get with flats that are converted from old buildings.

You've got the lovely windows there, floor-to-ceiling with the lead light in them. What this?

Yes, an en suite.

Looking good.

Second bedroom. Another sizable space and,

another en suite.

This is looking REALLY good.

This spacious two-bedroom flat seems to be in really good condition.

It might have storage heaters rather than central heating,

and the colour scheme may not be to everyone's taste, but there's a beautiful communal garden outside.

Two en suite bedrooms.

And a smart bathroom, all for a guide price of £55,000.

But something is not quite right here.

Another bathroom, there. Fab, fab, fab. And then through into

this, which is a large open-plan living area.

I mean what a gorgeous flat.

But there's a problem. And it's here

in the open-plan kitchen area.

I mean,

look at that. That's not good.

This is a really serious problem, because it's a leak which is coming

from the flat above here, you can see water has been dripping down.

It's caused the plasterboard in this place just to fall away, there's

water all over the floor that will be going down into the flat below.

Thankfully, most of the water is dripping into the sink,

otherwise goodness knows how many problems there would have been.

Theoretically, this is the responsibility of the management company of the building.

But you've got to get access to the flat above, so what if that's empty? What if you can't get in there?

You need to fix that, and you need to fix it soon. So maybe you could fix it from down here.

Maybe you could take this plasterboard down and there

are pipes, but how are you going to turn the water off?

Maybe you could freeze it. But they aren't your pipes to fix.

All in all, that is a big problem.

That's probably why the guide price was so low.

So, is this property a poisoned chalice or a solid gold investment?

I asked a local estate agent for his opinion.

The guide price was quite a low guide price, but I think

that's the impact of the apartments within the Sunderland market.

'In reference to the water damage in the kitchen, I don't think that's going to put any buyers off,

'because I think the asking price for the property was at a price

'where you'd expect to come in and do some work, generally, to the property, anyway.'

I'd put this property on the market for rent at a region of £500-£550 per calendar month.

That sounds pretty healthy.

What if the buyer decides to do it up for resale?

Once renovation has been carried out on this

apartment, I'd recommend an asking price of around about £100,000.

100,000? If a new owner snapped up the property close to the £55,000

guide price, they could make quite a profit, even after the cost of

repairing the leak and redecoration.

Not a bad afternoon's work.

Well, bearing in mind the financial history of this place, remember it was sold for

£170,000 around two years ago, the fact this had a guide price of £55,000 is almost unbelievable.

And yet, that would put a lot of people off.

And it's not necessarily going to be that easy to sort it out.

So, a bit of a gamble?

Let's find out who was willing to take it on when it went under the hammer.

This auction took place late in the day,

so there weren't many people around to bid.

Lot 179 in Sunderland.

Self-contained first floor flat.

Somebody bid me 40,000. In Sunderland.

40,000, may I say?

Thank you. 40, 41?

41, 42, 43, 44.

OK, 45, why not? 46. 47.

48.

49 and 50. 51?

No? Gentlemen standing back in the blue T-shirt at 50,000.

Is there 51 anywhere else? It's against you, sat down.

For the first time at 50.

For the second time at 50.

For the third and final time at £50,000, gentleman

at the back. We're all done?

Sold to you, sir.

So, after just 40 seconds, the flat was snapped up for £50,000, £5,000 below the guide price.

It was bought by Steven and his wife Carol, who run their own business in Sheffield.

They already have a small portfolio of properties which they rent out.

I wasted no time in asking them the crucial question on all our minds.

What about the leaking roof? When was the first time you discovered it, when you walked into the door?

-When we walked in today, yes.

-No!

-That's right.

-So, what did you think?

-What have we done?

Well, it's only cosmetic. It'll repair.

What do you mean, only cosmetic?

It'll not take much repairing.

-You hope!

-We hope.

If we can find where the leak is.

That's the issue, you see. Because it's up there somewhere, and you don't know where it is.

-That's the problem.

-Also, it might not be your pipes.

So you can't necessarily go mending it, can you?

True. Time will tell.

Let's hope it doesn't take too much time or money to fix this.

It's always risky not viewing a property before an auction,

even though Steve and Carol were buying on recommendation.

-A friend of ours had viewed it, but we hadn't.

-What did they say?

He was looking at it to buy for himself, and then things didn't work out.

So he showed interest in something else and

-we went for it.

-What did he say it was like?

He said that he couldn't believe that it would go for anything like

-50K, he thought it would go for a lot more money than that.

-Right.

And he didn't tell us about the leaking roof.

-He didn't tell you about the leaking roof?!

-No.

-Have you spoken to him since?

-Not very often.

So, what's the process for sorting this out, do you think?

I think we've got to establish where the leak is actually coming from.

So, the only way to do that is to take this ceiling down.

I don't think it'll need a lot of help to come down.

There's a danger, of course, that there's a million gallons of water up there.

That when you take the ceiling down, there's going to be a big gush

and this flat and the one below will get flooded.

Possibly.

Just bring a brolly!

So, what's the kind of timescale for sorting it out?

Start to finish, we hope six to eight weeks it'll be sorted.

And how much money have you put aside to sort things out?

Other than paying damages

-and compensation!

-Maximum 5K.

-5,000 quid?

-Yes.

I mean, intrinsically, it's a fantastic flat, isn't it?

It's a brilliant place, it's just this one issue that needs to be sorted out.

And then what's the plan for it? What are you going to do with it?

We hope to rent it out until the property market improves.

Right. Any idea how much you're going to rent it for?

The local estate agent said we could get, if we put reasonable-quality

furniture in it, round about £600 a month.

Wow! For a £50,000 investment?

-What a return, eh?

-Mm-hm.

-Brilliant.

So, is this going to spur you on to other investments of the like?

If it all goes smoothly.

Yes.

If we don't get too many lawsuits when we sort that out.

-Good luck.

-We might need it.

Well, there you go. It just goes to show the importance of looking at properties before you buy them.

And watch out, the residents of Hammerton Hall, when Steve goes prodding around with that ceiling.

Literally gallons of water could come pouring through.

You don't know what sort of things he's going to find.

However, let's face it. I think they've still got a bargain.

You can come back

to the soggy remains of Hammerton Hall later in the show.

In the property world, time is money.

So the aim is to work quickly and get things done.

So, have our new owners been successful or has time been their enemy? Let's find out.

We're back at Dinton Road in south-west London, where first-time property developer Basim

had bought a first-floor maisonette for 157,000.

But there was a surprise waiting for him in the back garden.

What did you think when you first saw the train line on your viewing?

I thought that it might be a problem.

But the estate agent said it is not like a big, big bad thing.

# Train kept a-rolling all night long

# Train kept a-rolling all night long

# Train kept a-rolling all night long

# Train kept a-rolling all night long... #

Basim still has a realistic attitude to the train track that runs outside his flat.

After all, it's something he can't change.

His intention was to spend between 15 and 20,000

getting the property back into shape and then sell it straightaway.

Although not spacious, the flat had four rooms and a tiny bathroom, with an unusual en suite kitchen.

The bathroom has been upgraded, with new fixtures and fittings.

And the kitchen has been turned into a utility room, housing a new central-heating boiler.

So, where is the kitchen now?

Well, it's in the rear reception room, transforming this dowdy,

dated space into a contemporary, stylish living area.

We've put the new kitchen in here, so what we can see that we have discovered is a very nice fireplace.

There used to be a sheet of plywood on it.

We took it out and then we found the nice tiles.

The fireplace has now been fully restored, and the room has become a relaxing, family-friendly space.

Although this has meant losing one room, the flat still has a decent-sized double bedroom...

..and a single room suitable for a child.

There is also a bright, spacious living room at the front.

So what is Basim most proud of?

The thing I'm most pleased with is the bathroom and kitchen, actually,

because they looked a really bad before that and now they look really, really nice.

And I think this is what differentiates any flat from other flats.

Most of the other rooms are basically rooms.

Now the kitchen is big. You can move around.

You can even have a dining table in there, where people have breakfast and stuff like that, for example.

So I think it made a huge difference and made the flat look more modern than what it used to be.

Did he manage to do all this within his initial budget?

I spent, overall, £18,000.

The only thing that I cut back on was the garden, where I was thinking of actually doing it all up.

The garden would indeed have been a challenge, but

for the sake of a quick turnaround, Basim has focused on the interior.

But it's not all been easy for him.

He has a very demanding job as an engineer,

so fitting in the refurbishment has put him under a lot of pressure.

A lot of times I was at work until ten o'clock,

finishing my work and then staying in the office doing this work, the paperwork and all the other stuff.

So then, for one month I think it was very, very difficult and very busy.

But now, once you've finished it off, you think,

"Thank God for that!"

Now that his time doing double shifts is over, what are his plans for the flat?

The plan right now for the property is to actually try to sell it and see how it goes.

If I get the price I want, then I will sell it.

If not, then I might rent it for a year or two years and then see how it goes afterwards.

I'm hoping to achieve £200,000.

And if I do achieve that, I'll be very happy.

I think that's the right price for it, which would give me a healthy profit.

What about his dad, who part-funded the purchase?

Is he in for a cut of the profit?

My dad? I think I'll try to take all my profit myself!

No! No, my dad is hoping to get some profit out of it, yes.

To get an idea of what Basim and his dad might pocket if the property

were sold, we asked two local estate agents for their thoughts.

Really like it. They've made a lot of use of the space.

'It's great that it's got its own garden, and it's a pretty good location as well.

'Being next to a train line is the kind of thing that will bother some people, won't bother other people.

'But you can overcome that by saying, look, if you want to live in London,'

you are either going to get road noise, plane noise or train noise.

You are in a cul-de-sac here,

so you're going to have no traffic noise,

and at the end of the day you do know when the trains are going to stop, whereas traffic is constant.

Looking at the property now, I think he's done very, very well.

Even with the train line there, I think he's done it to the right

standard and level that he will recoup all of his money.

There won't be a problem.

The train line is a negative, but then, most properties do have them.

Looking around, they have done a fantastic job on the re-plastering, re-wiring.

The kitchen and bathroom look really, really great.

They've done a really good job.

The movement of the kitchen from where it was now has given

a proper kitchen, a functional kitchen, which is perfect. I like it a lot.

If Basim were to put this on furnished flat on the rental market, what kind of return could he expect?

If I had to put it on the rental market, I would ask

£950 per calendar month and hope to achieve around the £900 mark.

If I were putting the property up for rent, I believe it would achieve around £850 per calendar month.

At around 6%, that's a decent yield.

It could tempt me to rent, but the problem with renting

is that if I do it, the money is stuck in one place,

whereas if I sell, I can keep using the money for other projects.

He bought the flat for 157,000

and spent £18,000 refurbishing and decorating it.

So if he was to stick to his original plan of selling it quickly,

what return might he get on his £175,000 investment?

If I was putting this up for sale,

I'd put it up for 199,950, looking to take an offer of about £195,000.

If I had to put the property up for sale, I'd put it on the market for £199,950.

Obviously, 200 is perfect for me. If I get that, I'll be very happy.

So, after four and a half months of hard work, Basim and his dad can see

a potential pre-tax profit of nearly £25,000.

Has he caught the property-developing bug?

I think the learning experience was very, very enjoyable.

At some points, of course, I was thinking, "Why did I do this?

I should have just stayed working in my normal full-time job."

I would do this again. With a bigger project, actually.

I'm hoping the next one will be my own house.

We've returned to Sunderland, where Sheffield-based couple Steven and Carol bought

a two-bedroom flat in Hammerton Hall sight unseen for only 50,000 quid.

The catch was that the open-plan kitchen was turning into

open water thanks to a leak from the ceiling above.

There is a danger, of course, that there's a million gallons of water up there, that when

you take the ceiling down there's going to be a big gush and this flat and the one below will get flooded.

Possibly.

Since that meeting, events have worked out largely to Steven and Carol's benefit.

Their bargain-priced flat did not need a great deal of work to make it ready for the market.

The only issue was what to do about that leaky ceiling.

The leak?

It wasn't as bad as we thought it was going to be, actually.

When we did eventually get into the place, there was mushrooms growing on the wall.

Obviously, the floor was very badly damaged.

But we knew it could be mended, we knew we could get contractors in to deal with it.

So, hey, we knew we'd got a good bargain.

We ended up getting an emergency plumber out, expected there'd be a pipe there that needed repaired.

When he took the ceiling down, there wasn't a pipe, so we found that the leak was coming from the flat above.

After contacting the property's management company,

Steven discovered the whole building was covered by insurance.

An assessor came round to gauge the damage.

We had an original estimated budget of about £5,000.

The insurance came back to us and made us an offer in cash

or they would appoint a contractor to go ahead and do all the repair work.

We took the cash offer and got the work done ourselves.

And that covered more or less everything, really.

I can't wait any longer. Let's have a look at the new kitchen.

This is where most of the damage was.

The ceiling was down here,

the water coming through the light fittings, dripping onto here.

Damaged all the floor. And also, the floor in there was...

was a mess.

That beautiful oak flooring was in a sorry state before, but now it's come up a treat.

When the contractor came in, he had to remove this wall,

take these units out.

He managed to save the tiles. Repaired the kitchen units.

And he suggested, rather than try to match the floor, that we tile the floor.

And we've just put ceramic tiles down.

So that saved a chunk of the budget, really.

And we're quite pleased with it. It works well.

# I should be so lucky, lucky, lucky, lucky

# I should be so lucky in love... #

Steven and Carol have certainly been lucky.

They've got a fabulous new kitchen all covered by that insurance claim.

This means that they haven't had to dip into the £5,000 pot they set aside to do the work.

And their good fortune doesn't end there.

There was a bit left over from the insurance, so that went

towards some of the painting and things.

But with regards to the rest of it, probably about 1,500 we've spent.

Most of this money was spent on sprucing the place up,

re-plastering the walls, fitted carpet and new furnishings for the living room and bedrooms.

But it hasn't all been plain sailing in this Sunderland flat.

The couple had been project-managing the whole operation from Sheffield, where they live.

Managing it from 120, 130 miles away is difficult.

You can't just nip out in a morning, meet someone and go back to work.

It's a full day's job

and we've had to stay in hotels overnight and things whilst

we've been here getting some of the repair work done and some of the painting done etc, etc.

What are their plans now?

We intend, short term, to rent it out.

Next two or three years, see what happens to the markets.

We think we it got a bargain when we bought it at 50.

We were very, very surprised when we came in and saw what we'd got.

We hope that it's worth at least double that now.

We don't really want to sell it, but if someone came in with the right offer, we'd perhaps look at it.

But at this moment in time, we think the rental market is the best option for us.

Steven and Carol snapped up this property for an amazing £50,000.

Thanks to the insurance claim, they've only spent around £1,500 doing it up.

Altogether, that is still £3,500 below the auction guide price.

So, what do two local estate agents think of the flat now?

'I think they have done it to a really, really good standard.'

I think it's nice and fresh when you come in.

Obviously, the new carpets, new decor, it really looks good.

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

'I think the lounge is a good example of that, and the fact that your master bedroom,

'you can get a good-sized bed in there and you still have space for the wardrobes and things.'

My first impressions of the apartment are

it's of an excellent size, it's got a lot of period feature.

'It is nicely specced up, it's got good-quality fittings in.

'It's in a Grade II listed building.

'So it still retains a lot of its character.'

It's a lovely apartment.

They bought the flat with the intention of renting it out, so what rental could it earn?

This would rent out on the market at the moment at around about £495 per calendar month.

The rental valuation on this particular property

would look to be around £550 per calendar month.

It seems their good fortune here continues.

That's a very decent 12% yield.

-OK.

-That's about right. The second one.

-We thought a bit more.

-Yeah.

-We thought furnished, we thought 550, 575, just under the 600.

If they were to put this apartment back onto the market, how much could they get for it?

Resale valuation of this flat at the moment would be around £100,000, £110,000.

In a good market, this is potentially going to be worth 100,000 plus.

At this moment in time, the market isn't fantastic, but I would still imagine

it's going to carry an asking price of around about £100,000.

So, they have potentially doubled their money in just three and a half months.

Impressive. They must be well chuffed about that.

-Yes.

-For what we've paid, we're winning.

-Very pleased.

-We're very pleased with it, aren't we? Yeah, that's great.

With such great rental and resell returns on their investment, are they tempted to cash in now?

I think we'll run the market a couple of years and see what happens to the market, really. We think that

things can only go up, really.

I'm satisfied with the

valuation but greedy!

We were lucky, I guess, buying it the way we bought it,

and lucky that we got the insurance claim, which paid for it all as well. So we've done very well.

It is a win/win situation for us,

especially on this time. But it doesn't always happen.

In fact, Steven and Carol have found a tenant and are now

renting the flat out at £550 per calendar month.

so their luck is still very much in.

# I should be so lucky, lucky, lucky, lucky... #

Well, that really is it for today's properties.

-Join us next time for more Homes Under The Hammer.

-We'll see you then.

-Goodbye.

-Goodbye.

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