Martin Roberts and Lucy Alexander visit a house in Cheshire, a property in London and a flat in Lancashire, and find out how much they sold for at auction.
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-Hello and welcome to the programme.
-We all know that the value of houses
-can go down as well as up.
-So it pays to buy at the right price
-in the first place.
-One way you can do that
is to buy your next home under the hammer.
If you're sitting at home thinking you'd like to buy at an auction, now could be a good time to start.
Yes, the market is always changing so you have to judge when is the best time to buy.
-Today's buyers have already put their money on the line.
-And this is what they bought.
'This house with kennels in Cheshire could put your budget in the dog house.'
When you come to restore this place, it's going to start notching up the costs.
'I find a potential money pit at this London property.'
If that wasn't enough,
there's a great big crack on the wall just there.
'And this magical flat in Lancashire pulls out an extra rabbit.'
Not only do you get the flat when you buy this particular lot,
you get the freehold of the building.
'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.
'I've come to beautiful rural Cheshire.'
This is the main road linking Nantwich with Stone
and I'm in a little village called Walgherton.
Not much here apart from a pub and a few houses and this property that was up for auction.
It's a former kennels. It's got three quarters of an acre of land.
Guided £300,000 to £325,000.
'It certainly sits pretty on this expansive land
'but there are signs of wear and tear when you get closer,
'although there's no denying its chocolate-box facade.'
Well, it's definitely got a very cute front aspect.
Then straight in through the front door, look at that. I love that little window.
And then wow! Look at this staircase!
You would not expect something quite as wide as that in a house like this.
That's really nice. It goes a bit downhill in this room
cos you've got another door leading into the dining room. That's a bit strange.
But then over this side, I guess this is your main living room. Open fires.
Original features I guess, although not that brilliant.
But nice to see that you've got some beams there.
Then through into the kitchen. Cute little farmhouse kitchen.
Again, you've got your original beams, your range cooker.
I mean, it needs completely renovating.
But as layouts go, not a bad one.
'So, it's a good start layout-wise,
'despite the fairly poor state of repair.
'Time to head on up.'
Sadly, upstairs, the layout starts to go horribly wrong.
Two good-size double bedrooms, one that side and one over there,
this tiny box room and a separate loo, but you've got these levels
and I see these and I think, when you come to restore this place,
if that's what you wanted to do, it's going to start notching up the costs.
'Old houses like this can present enormous problems.
'Rectifying them can cost serious money so novices beware.
'Unless you know what you're doing and have the money to do it,
'this rather dog-eared former kennels house is probably one to avoid.'
Down here in the old kennels, you can really see that this place is currently a Heinz 57 mutt.
What it needs is someone with the tenacity of a Rottweiler
and the saving characteristics of a St Bernard to take it on.
# Who let the dogs out?
# Who let the dogs out?
'It's definitely a dog-tired old property and may hound a new owner but there's potential.'
So, what could you do with this place? Well, I suppose one option would be to look at extending it
if you needed a bigger home. Or my preferred option, although I hate to say it,
knock it down perhaps. Could you? Maybe? Even that staircase?
# There's got to be a better way
# Tear it down
'OK, I can hear your gasp of horror. Knocking it down does seem drastic.
'But this could turn into a real money pit if the new owner isn't careful.
'You could just take a sideways step and increase its footprint with an extension.
'My property developer's head says no way!
'With a guide price of £300,000 to £325,000
'let's hear what a local estate agent makes of this tired cottage.'
I think this property is amazing. I think it's got great prospects
and it'll make a great family home.
'That somebody is going to have to be ready for some hard graft.
'With so much land, the owner will have plenty of options.
'So what's its development potential?'
The land that's available here is quite a substantial plot.
It's just under an acre. The property as it stands doesn't really do it justice,
so I do believe we're looking at either an extension of this existing property
or complete rebuild.
-'Let's talk prices.'
-The rental figures per calendar month
for a property of this size,
you'd be looking at somewhere in the region of £800 per calendar month.
If you were to redevelop this property, either by extension or a complete rebuild,
then you'd be looking at somewhere in the region of £750,000.
Well, if you're looking for a farmhouse to do up
and enough land to create yourself a bit of a smallholding,
you could've found it here just outside Nantwich.
Let's find out who bought it when it went to the auction.
This is a former kennels house. It occupies an excellent site in a most attractive rural locality.
250 I've got. 250 I've got.
255. 255. At 255.
260? 260. At 260.
At 260. And 5. At 265. At 265.
270. And 5. At 275.
280. At 280. At 280.
And 5. At 285.
290. At 290.
295. At 295.
300. At 300. 300. And 5, sir?
At 305. At 305.
10. At 310. At 310.
At 310. 15 now.
At 310. At 310.
We'll make it 12 and a half. You can't beat it.
At 312 and a half. Come on, you'll go for that.
312 and a half. At 312 and a half. Are we all done?
Again, I'm sorry, it's below my reserve price
but please stay and have a word with us, we'll see what we can sort out.
'And have a word is what those determined bidders did
'when the property didn't reach its reserve.
'New owners Nigel and Claire stuck to their final offer of £312,500
'and sealed the deal after the auction.
'Claire is a teaching assistant and Nigel's an electrical contractor.'
-Claire, Nigel, lovely to meet you both.
-Why did you want it so much?
Erm, we could see the potential.
We only looked at the property seven days prior to the auction.
We could see the potential. We set our price
and went to the auction with a complete open mind.
Tell me more about the plans for it.
There's many, many things at the moment going round in our heads
but, obviously, we love the original cottage.
We want to be able to develop the original cottage
into a much bigger family home.
You could pull the whole thing down and start again. Is that an option?
-No. We want to keep the old building.
With the local council, it's going to give us a little bit more scope to play with planning
if we keep the old part of the building up.
And also, the front of it is so beautiful, that's what we fell in love with.
It's sort of chocolate-box pretty.
And it would be such a shame to just bulldoze that down.
# You're sweet like chocolate, boy
# Sweet like chocolate
'So, the sweet Cheshire cottage lives to see another day.
'Claire and Nigel are unsure about future development on the rest of the relatively large plot,
'although they are aware of its building potential.
'What do they plan for the property itself?'
Do you have a vision of what the house will be when it's finished?
I have in my head. Nobody else can see it apart from Nige and I at the moment.
All they see is this little cottage with lots of kennels.
But we envision the pretty front of the house
tied in with a huge extension.
There's going to be lots of light, lots of oak and glass.
We want it to be a little bit different.
And the idea is it becomes your family home?
-How big's the family?
We have my two children, Lizzie and Will, Nigel's two boys, Alex and Matthew.
So we're going to need lots of space.
So where do you live at the moment and what are you going to do?
We live at the other side of Nantwich
in a little village called Worleston.
We live in a barn conversion there, but until we sell that property,
we will be leaving this just to develop as best we can
with the limited resources we have at the moment until we can fund it.
'So the couple can make a start here while their current house, 45 minutes away, is on the market.
'Once that's sold, they'll live on the site while the work is being done.
'As Nigel's in the building trade, his own skills and contacts will be invaluable.
'The couple reckon it could take two years to complete
'what they hope will be a home with a real wow factor.'
What about budget for all this? Cos you've got your other house that you haven't sold yet.
We have a budget in our head
but, at the moment, until we sell this other property
and we set it up and we get planning, we'll work everything out.
In terms of budget, we want to be able to self-finance as much of this as we possibly can.
How will you divvy up the work? Are you going to get your hands dirty, Claire?
Definitely, yeah. I already have. Don't mind getting my hands dirty.
You can't say romance is dead. He bought me a pair of rigger boots last week.
-All in all, you're happy with the way things have turned out.
-It's exciting. We haven't had much sleep since we bought it.
We keep planning. We've had to buy a big block of graph paper cos we keep drawing all the plans. It's exciting.
Great. I'm delighted for you both. Good luck with it
-and I look forward to seeing how you get on.
-Thank you very much.
Well, it's seems like Nigel and Claire were destined to own this place
and they've certainly got some ambitious plans for it.
It all comes down to planning permission, of course,
but intrinsically, it looks like the property is saved.
Join us later in the show to find out how they get on.
Welcome to New Cross in Southeast London.
It's an area that's experiencing a real resurgence.
So what's new about New Cross? Well, the artists are moving in,
there's galleries popping up all over the place, plus transport links are set to be transformed.
'The East London line is coming here in 2012
'and will form part of the wider over-ground orbital network.
'It will allow travel around the capital by train without having to enter Central London.'
# The train is coming, baby
# I said the train is coming now
And here it is. Now, the guide on this attractive property
Let's have a little look around and see if it's as attractive inside.
'From the outside, this property, split over three levels, is certainly impressive.
'There are ornate mouldings round the doorway, the bay window, and it's great to see exposed brickwork.
'Let's explore inside.'
This property is divided currently as two flats, one upstairs and this one here on street level.
There's a sitting room through there, not a bad size.
And oh, my goodness, the kitchen. Bit of a purple palace.
And, of course, there's a gaping hole in the ceiling.
You can actually see the upstairs floorboards poking through.
So that immediately needs to be looked at.
And my first impressions are not positive here
because it feels cramped, it's dark, you've got sloping ceilings here
and this whole house feels like it's leaning that way.
And if that wasn't enough,
there's a great big crack on the wall just there.
So I'm not loving this place at the moment.
'This property is cracking up, and in more ways than one.
'It's been lying empty for a while.
'There are signs of damp in the front room and the kitchen needs major work.
'It all just feels a bit neglected
'and could do with some serious TLC.'
# Cracking up
# Like a worn-out shoe
'On the lower ground floor, the three bedrooms also have signs of damp
'and desperately need a revamp. There are garden views at the rear
'although at the moment, if there were any curtains,
'you'd probably want to keep them shut! What about the one-bedroom flat?'
So upstairs is the second flat
and there's a little more of that Victorian character showing through up here.
You've got original sash windows, nice banisters.
But unfortunately, there are two things up here that may put you off.
There's a serious case of damp in that back bedroom
and a fire-damaged kitchen up there. Sorry to be the bearer of bad news.
'You could see this as thoroughly depressing. However, although it seems to be falling apart,
'the bones are here and after some remedial work, this has the makings of a really good flat.
'Both flats are large and spacious so whilst first impressions are not promising,
'it may pay to see past all the drudgery.
'The guide price was set at £235,000.
'We asked a local estate agent what she made of it.'
The first impression is it's in a great area,
a great investment opportunity
and it has the potential to either keep it as a family home
or convert it into apartments.
'If the property was refurbished and sold as flats,
'how much could they sell for in this area?'
A one-bedroom in the area is achieving between £160,000 and £170,000.
A two bedroom would achieve between £200,000 and £220,000.
And a three-bedroom would achieve close to £230,000, £235,000.
'That's a significant return. And there's also a strong rental market in New Cross
'with two-bed flats commanding £850 to £900 a month.'
With a university round the corner, you will always have a steady stream of tenants
and improved transport links due for completion next year
are set to transform this part of London.
As a result, New Cross is definitely on my property radar.
But, you know, this house is going to require a lot of work.
But fire damage and signs of subsidence didn't put someone off.
Let's go to auction and find out who that was.
So, invite your bids. 205 standing up, yeah?
205. 210. 210.
230. 235, sir? At the back.
250, yeah? 250.
251 down here. 252.
Well done. 261.
Have a think. 261. 262, new spot.
Yep. 264. 265.
268 with you, striped shirt. 268.
269, back in.
272 down here.
First time, second time,
third and last time if you're all done.
'The successful bid of 272 came from Ishmael.
'Originally from Turkey, he's lived in London for the past eight years.
'He has a food import and export business
'but hopes that one day his part-time property investing will become a full-time career.
'I met him at his latest purchase to hear his plans.'
-Are you really excited about having bought this at auction?
Yes. I think it's going to be challenging for me, but I am excited.
So now you've had time to take it all in, to have a good look around,
are you still as excited?
A little bit worried but still excited.
-What are you going to do with it?
-I'm planning to convert it to three flats,
one three-bedroom family house with garden as the lower-ground floor
and the raised ground floor is going to be a one-bedroom flat
and upstairs, the first floor with loft conversion
is going to be a two-bedroom flat.
It depends on the council permission.
'Wow! I'm impressed. But also a tad concerned.
'Squeezing three flats with so many bedrooms into this property
'seems very ambitious, but Ishmael has a clear plan for that.'
Ishmael, what are you planning to do with this, rent it or sell it once the work's complete?
First, I want to sell it.
If I can't, in this area, there is a good rental market.
'Ishmael hasn't wasted any time doing his research and getting organised.
'He's contacted the planners and got a verbal green light for conversion to three flats.
'His architect has drawn up plans for the three-bed flat
'with an extension on the lower ground-floor,
'a one-bed on the ground floor and a two-bed maisonette on the top floor and loft space.
'Ishmael certainly doesn't hang about!'
# I got ants in my pants and I need to dance
'And that's just as well.
'Currently he has three properties that he rents out
'but he's never faced such a mammoth renovation before.'
So this really is going to be a very challenging project for you.
-It's what I want.
-You want this?
-Why do you want this?
-Because I'm changing my career focus gradually in the property business.
Because I am doing my import/export business, property was my part-time hobby.
In the last five months, I decided it's going to be vice-versa.
The property's going to be my main focus
and my import/export business is going to be just part-time work.
And how hands-on are you with work?
Can you lay flooring? Are you good at tiling? Can you check the electrics?
How involved are you going to be?
According to my wife, I am a DIY man
because I'm doing, in my current house, all the shelving, painting, wallpaper.
I believe that I can do, not the major work, not the technical gas or electric,
I wouldn't touch that side because of health and safety, I will not do it myself,
but I can lay the tiles, I can do the painting, I can do the gardening.
'It's great to hear he's such a dab hand at DIY as it's a real money-saver.
'But Ishmael's doing the right thing by getting professionals in
'for the more specialist jobs, like the electrics. These will definitely need to be checked out
'given the fire damage in the upstairs kitchen.
'A bit of good news is that the fire stemmed from the boiler,
'it wasn't too severe and it didn't affect the structure of the building.
'OK, let's talk cash, because sorting out this ugly mess will surely cost a pretty penny.
'He reckons he has about £115,000 available.'
So what's the profit you hope to walk away with once this is all done?
I think if there's a 20 percent return, it will be great.
-And that's if it all works out and goes in your favour and you get the planning permission.
-Ishmael, there's a lot of work to do here but I wish you well.
-Nice to meet you.
Ishmael has his work cut out with this one
and I'm not sure turning this into three flats is such a good idea.
But it will give him a fantastic return if it all works out.
But will he get it past the planners and is there enough square footage to accommodate three flats?
And that's even with the planned extension.
You can find out how Ishmael gets on with his biggest project to date later on in the show.
'Coming up, converting the basement of this Lancashire flat could be well worth it.'
It could add that value back onto the property, but more than that, it's a lifestyle thing.
'Has Ishmael been penny-pinching or splashing the cash
'on his first major development in London?'
I just got £10,000 over the budget.
'But first, in Cheshire, Claire and Nigel have settled in.'
Very, very quickly it just feels like we've been here forever.
'We're back in Walgherton near Nantwich, Cheshire,
'where this former kennels house on almost an acre of land
'sold for £312,500.
'I met Claire and Nigel who had ambitious dreams for this tired old place.'
We envision the pretty front of the house
tied in with a huge extension.
So there's going to be lots of light, lots of oak and glass.
We want it to be a little bit different.
'Have the couple got everything they wished for?
'Two and a half years later and we've returned.
'It's not just the seasons that have changed.
'There's now a huge double-storey extension stretching right across the back
'which is a sympathetic blend of old and new.
'There's a stylish and ultra-modern kitchen-dining-living room area.
'Two sets of French doors allow in plenty of light
'whilst also giving easy access to the garden.
'The frontage has been beautifully restored
'and whilst it retains its cottage feel, inside it feels like new.
'The former dining room at the front has been converted into a cosy study.
'Whilst the formerly bare and bereft living room has been lovingly refurbished
'with this beautiful brick fireplace as a focal point.'
This is the old part of the house and this is now the snug.
It was the original lounge in the old house.
There was an old fireplace in there. We've replaced it now with a log-burning stove
We've got under-floor heating in here and it is the cosiest room in the house.
'Upstairs, they've remedied the issue of the different floor levels
'and created a beautiful master bedroom.
'With luxurious en suite.
'The box room is now a gorgeous single guest room.
'Also en suite.
'The layout changes and extension have allowed for an extra bedroom to be created.
'There are now two large double bedrooms
'with a shared Jack and Jill bathroom for Claire's children, Lizzie and Will.
'As a reward for their hard work, they've chosen their own decor.'
Virtually from the plan, they chose which rooms they would like
and then as the rooms began to take shape,
they decided what colour scheme they'd like and what beds they'd like, et cetera,
and then Will decided that he'd like to have a graffiti artist decorate his room,
so we phoned a great guy that came and did that.
And Lizzie has found all different wallpaper samples and fabric samples
and designed herself a lovely room and they're both well deserved.
They've been great and worked really hard.
'In fact, all of them really put their backs into this project
'and the family only moved in properly two weeks ago.
'So how was the experience for them?'
Highs when we started and when you see big things happening,
when the new roof went on and the garages went up,
having it all plastered and having the floors go down,
when you can see big changes, that was really good.
Lows. What have the lows been? Taking the roof off on Boxing Day.
Taking the roof off on Boxing Day and the worst winter in history, the recession hasn't helped,
so we've had to work hard at it and we've stopped and started,
mainly due to things that have been unforeseen sort of thing.
But we're there now and we've moved in.
# And it looks like we might have made it
# Yes, it looks like we've made it to the end
'So they've made it, and as is often the case with projects like this,
'it's been a bit of a rough ride at times.
'But why did it take six months longer than anticipated?'
Planning permission took nearly 12 months,
going back and forth, back and forth, but we eventually came out with what we pretty much wanted.
We had to make a couple of changes.
And then from when we got planning permission to the first spade going in the ground,
it's been just over 13 months.
Which isn't bad going, but if you think about the 18-hour days
that Nigel's done, seven days a week
with me and Lizzie and Will labouring for him,
it's been pretty tough!
But it's been well worth it.
'The couple were unsure what their renovation budget was when they first bought the property.
'So just how much have they spent?'
When we worked it out, we thought we'd spend about 150.
And roughly, without a calculator, it's just under that figure now.
'It's been a long haul, but it must be a huge relief to be finally living in their fabulous new home.'
The first weekend we moved in, because everything is new,
it felt really strange to be living in the house that we've worked on for all these months,
and then to actually be living in here, sitting on the sofas, sleeping in the beds was really strange.
But very, very quickly it just feels like we've been here forever.
'So, with £312,500 paid at auction
'and an estimated £150,000 spent on the renovation,
'making a total of £462,500 so far, has the work been worth it?
'We asked two local estate agents for their opinions.'
I think the property's wonderful. It's got a lovely sweeping drive,
three-car garage. And inside, the accommodation and presentation
is excellent, the finish is superb all the way through.
I have no issues at all with the quality of this house.
The property overall has been finished to an excellent standard,
very thoughtful in terms of the refurbishment
and, aesthetically, offers something a little different
than a lot of other properties in the area.
'The estate agents reckon they could make £1,500 per month on the rental market.
'But Nigel and Claire have always intended this to be their family home.
'After all their hard work, have their improvements added value?
'What could it make on the resale market, remembering their outlay is just over £462,000?'
I would expect to put the house onto the market at £495,000.
I would look to put the property on the open market in the region of £600,000.
'Quite a difference of opinion there
'with the current climate making it fairly difficult to predict. What does Nigel think?'
I think I'll go with 600 because at this point, we haven't finished the property,
the actual building is finished, we've got a lot of landscaping to do,
we're in the middle of a recession and I think, when we actually market the property in a few years,
I think there'll be a hell of a difference in the price.
'Well, it's unlikely they'll be selling any time soon
'considering they've only been living here for two weeks.
'How do they feel now the hard work's behind them?'
When we look at the photographs of what we bought to what we've got now,
you have to pinch yourself. It's a lovely feeling, isn't it?
It is, yeah, and I think what we've achieved is, as we've said before, a lovely family home
that even when we sell the property, we'll be able to drive past it and say to ourselves, "We built that".
'I'm in the heart of Lancashire in its historical capital, Preston,
'almost exactly midway between Glasgow and London.'
Preston - a city of firsts.
The first motorway in the UK, the M6,
the first traffic cones ever used
and the first place outside London
where they used gas lights.
So, what's that got to do with property? Absolutely nothing at all!
But this is the one I'm here to see. Had a guide price of £35,000 to £40,000.
It's a flat in this converted Victorian terrace. Let's take a look inside.
'The terrace was built in 1859 but divided into two flats in 1992.
'It's the one-bed ground floor flat that I'm here to see.'
So, what's on offer? Oh, I say, that looks pretty good.
I'll tell you about that in a minute. We've got this corridor leading down to the rear.
Your bedroom there. Then through to the thing I've just seen, which is this!
A fantastic, huge living room.
Love the high ceilings, love the fact that there's still some period details
and this massive bay window. Lots of light. Doesn't feel like a small flat to me.
'I'm loving this already. The room's magnificent.
'Just look at the fireplace.'
# You're beautiful
# You're beautiful, it's true
'The bedroom's much less ornate, but it's still a good-size double with loads of storage.
'But I've spotted some damp on the back bedroom wall so I'd get that checked out.
'That said, you only really need to decorate the room,
'add some personal touches and the bedroom's home.
'With its loo tucked behind a wall, the bathroom is dated and, let's face it, far from pretty.
'You'd definitely need to put a new suite on your shopping list, I'd say.
'One good thing is that there's a decent-size back yard.
'However, the upper flat does have right of way across it
'as their fire escape is on the rear kitchen wall at the back.'
So all the way to the rear of the flat and you'll find the kitchen.
As you can see, it's in a bit of a state.
Definitely a visit to the local DIY store or get a kitchen expert in to sort this one out.
But it's a good-size space again, so we like that.
Boiler looks like it need replacing.
All in all, there's things to be done, but the good news is
that not only do you get the flat when you buy this lot,
you get the freehold of the building
and that has lots of advantages in terms of the fact that you get to charge ground rent to the other flat
and also you can do what you like to this flat without asking permission.
However, it does come with obligations and those needs to be checked out by your solicitor.
'The freeholder is responsible for the upkeep of the fabric of the building,
'maintaining the shared hall that both flats use and that sort of thing.
'But the lease agreement here means that the upper flat has to pay half the cost of works undertaken.
'This ground-floor flat doesn't stop at ground level.
'There's more in the basement.'
Down here, a real bonus to the property
because you've got a decent size cellar and it doesn't smell too damp.
So, in its simplest form, this is a great place to store stuff,
but I think you could do much more with this. For a start, you've got some natural light here
so why not think about converting it into a kids' play room
or maybe a media place with a huge great television so you can watch your movies?
There's all sorts of things you can do. Converting it, though, really is a job for the specialist.
You've got to think about tanking the walls, maybe putting on special membranes
and then pumps to pump away all the dampness.
But I think worth the effort. In terms of cost, £800 to £1,500 a square metre as a guide.
It could add that value back onto the property, but more than that,
it's a lifestyle thing. What a great space.
# To the basement, people, to the basement
# Many surprises await you
'For anyone buying this as an investment property,
'would it be financially worthwhile to convert the cellar?'
'What does the auctioneer who sold it think?'
I suppose, from the basement point of view, it could be converted.
The height is there and the potential is there. It could be done.
From a return point of view, not sure whether, if the property was resold
with a basement conversion, whether that would add enough value
for the cost involved. From a rental point of view,
I'm not sure the increase in rental return would be worth it.
'What about the rest of the flat that went to auction with a guide price of £35,000 to £40,000?'
It's a good size for a one-bedroom flat. The room sizes are good, the ceiling height's nice.
It does need some work. Standard renovation, really. Bathroom and kitchen need modernising
and then general decoration. In terms of return, we're looking at £400 to £425 per calendar month.
'What about the potential market value once it's been done up?'
The value of the property once completed, without a basement conversion,
would be £65,000 to £70,000.
If the basement was converted, you could see a value starting at around £75,000, possibly up to £80,000,
depending on how the rest of the flat panned out.
So, all in all, a good-sized flat.
Yes, it does need a bit of work to sort it out,
but you've got the added advantage of the bit of garden, the basement
and you get freehold of the whole building.
And it's pretty close to Preston City Centre, so lots of reasons to buy it.
Let's find out who did when it went to auction.
Lot 111 is a vacant one-bedroom ground-floor flat.
'This lot was towards the end of the auction
'so the room was emptier than earlier.
'Let's find out if anyone got a bargain.'
Shall we start at 20? £20,000 do we see? 20 I've got straight in.
25 then? 25 anywhere?
Stood at the back I've got 25. 30.
30 I've got there. 32 I've got. 34?
34 I've got. Want to make it 36, sir?
I think that's a half I've got. OK. 34 and a half, I'll take it.
35,000. 35 I've got. 35 and a half, then.
OK, it's with the gentleman sat right in front of me at 35,000.
35 and a half, new bidder at the back.
35 and a half I've got. 36. Got it. And a half?
Got that, as well. 37.
Got. 37 and a half. Yes.
38. And a half.
I've got it. Want to make it 40?
Are you sure? 40,000 I've got.
41? 41 I've got. 42. Shaking his head.
£41,000 then to you, sir, for the first time.
Second time at 41,000. Third and final time.
Well done, sir. Your paddle number is 777.
'That final successful bid of £41,000 was made by Paul.
'He's an engineer who lives in Preston.
'He bought the flat in partnership with his friend, Chris, who's a stockbroker.
'I met up with them at the flat to find out more.'
-Paul, Chris, good to meet you both. Congratulations.
Tell me why you want to buy this little flat. Well, big flat, actually!
I actually came to have a look around and dismissed it
because my initial impression was that it was going to be a smaller place
in not too bad condition.
And what I found was a larger place but there's damp problems and various other issues here.
-I wrote it off initially.
-You shouldn't get excited about it cos it's a boring one-bedroom flat.
-Well, the other places we've got are six, seven bedrooms
-so it didn't...
-There's not a lot in it.
-It's got a cellar.
-It's great! It's got huge great rooms, high ceilings. What do you want?
I was keen. I'd only seen the outside but I wanted to buy it.
But we had our eye on another place at the time that needed totally knocking around.
I think Paul quite fancied the idea of bashing something up a little bit.
But he rang me when I was having my lunch one day at work and said, "The auction's in 45 minutes,
"what do you think?" And so we thought we'd give it a whirl.
It'd be a shame if we didn't go and it went for a good price, I'd be disappointed.
So you were told you were going to the auction 45 minutes before it started?
-Literally. It was a mad rush.
-But the thing with Paul is...
That's why the partnership works so well.
He's the ideal person to be going to the auction. You know that he'll do the right thing as a friend.
-Why are you such an ideal guy?
-I can imagine, if I sent Chris, he'd end up going way above the guide price
and landing us in a more expensive property,
whereas I'd be quite regimented and I wouldn't go over my top.
But it was a little bit last-minute.
-Yeah, it was. But it's all part of the fun, isn't it?
'I'm impressed. These guys seem to have a great working partnership.'
-Tell me about the relationship between you two.
and a few years ago, I was looking at buying a property
and as Chris already had a rental property, I thought I'd give him a call and see what he thought
and he said, "I'll go halves with you on the next one" so it started from there.
So we went halves on that first property and a couple of years later bought another one.
-Obviously, financially, it's easier to share, but also with the stress levels, it helps.
-So you've invested together on all the properties you've got so far.
'Paul and Chris aren't full-time developers,
'as Paul still works as an engineer and Chris a stockbroker.
'They intend to use contacts in the trade they've worked with before.
'So what will they do here?'
-Talk me through exactly what you're going to do.
-We'll start from the front.
Metal railing round the front, we'll redo the flagged area at the front so you get a nice first impression.
We'll decorate the hall, stairs and landing, recarpet that so it looks pretty sharp.
And then go through the house and just give it a nice, fresh, clean, neutral look.
We have to, at the back, sort out the damp. So all the plaster's being chipped off
and replastered, reskimmed, once the damp's sorted and then it's a new bathroom and a new kitchen.
'Well, no mention of that cellar so far.
'So do the boys have any plans for that potentially beautiful basement?'
I think, realistically, it's going to be for future development.
At the moment, we'll concentrate on the main house, just for speed of getting it rented
and getting some money back, but there's potential in the future.
And it's a great storage space for any tenants.
-And the budget for all the work so far?
-And a timescale?
-Start tomorrow. We'll crack on quick. We're good to go.
-We've got everyone lined up for the next few weeks.
-Congratulations. Lovely to meet you.
-Good luck with it.
Well, it may have been a bit of a last-minute decision
but I think Paul and Chris have got themselves a great property here.
But can they really restore it for ten grand and in six weeks?
You can find out later in the show.
They say time is a healer, but it can be an enemy if you're up against a deadline.
-What has happened to those properties?
-Let's go back and find out.
'We're back in New Cross, Southeast London,
'where this mid-terrace property sold at auction for £272,000
'to food exporter and importer Ishmael.
'The house was in a pretty poor state and split into two flats.
'But Ishmael had ambitious plans to squeeze in three apartments.
'He hoped to make developing less a part-time interest and more a full-time career.'
I'm changing my career focus gradually in the property business.
Because I am doing my import/export business, property was my part-time hobby.
In the last five months, I've decided it's going to be vice-versa.
'13 months later we're back to see if Ishmael had bitten off more than he could chew.
'Unfortunately, he hasn't got planning permission for three flats,
'although he is appealing the decision. So there are still just two, but they are much bigger.
'There's a three-bed flat on the first floor and in the loft space
'and a massive five-bed flat on the raised ground and lower ground levels.
'I had some misgivings about Ishmael's plans, but now can't wait to see the result.'
# I was blind
# Now I can see
# You made a believer
# Out of me
'The lower ground floor of the five-bed flat has been completely transformed
'from a dank and damp-ridden dungeon into a light and airy living space
'housing two rather than the three bedrooms intended.
'A modern bathroom has been fitted
'and a fabulous extension been built at the back,
'housing a stylish and spacious kitchen/dining room.
'Patio doors lead onto a newly-cleared decking and lawn area
'with a summer house at the top of the garden. If planning's ever approved,
'this floor would become a self-contained two-bedroom garden flat.'
I decided to do the extension and move the kitchen upstairs in here
'so that people can enjoy the garden in the summertime.
And this part is one of my favourites in this project.
'Moving upstairs to the raised ground floor area are the other three bedrooms.
'The damp has been eradicated, the rooms are fresh and light with a contemporary finish.
'The former kitchen has been split into a stylish bathroom and bedroom.
'The bedroom could be converted back into a kitchen in future
'and the front bedroom would become the lounge if this floor ever becomes a separate one-bedroom flat.
'The former rear bedroom and storage area have been converted into a spacious fifth bedroom
'with a double-aspect window.
'Moving upstairs to the three-bedroom maisonette, accessed from the main front door,
'and what was a dreary, outdated bedroom on the first floor has been brought back to life.
'Also on this floor is a modern bathroom.
'Up the beautifully refurbished stairs now to the second landing
'where the formally dreary reception room is warm, modern and inviting.
'The kitchen, once decimated by fire, is now a fully-functioning, modern galley kitchen.'
We were lucky. The fire damage, it was small.
It hasn't damaged the main structure, just damaged all the wall plastering and the floor.
'Up in the loft conversion, there are two bedrooms to the front and the rear of the roof space
'with a bathroom in between. It really is a gorgeous conversion.
'Initially, Ishmael estimated it would take six months to complete the job.
'So what are his thoughts 13 months on?'
The first six months was just the planning permission. We didn't do anything else.
And after six months, when we got the planning permission, we started the project.
It took six months, so the whole project was roughly one year.
'So a bit behind schedule,
'but allowing time for planning should always be factored in when you're property developing.
'How about Ishmael's budget? He'd originally hoped to keep it to £115,000.'
I just got £10,000 over the budget.
The reason, in the first budget, there wasn't any summer house
and all the roof tiling, front and back, needed changing.
And after that, I decided to retile the entrance and steam-clean the front and back of the house.
'I'm really impressed with the quality of this renovation.
'It's been completely gutted and transformed from top to toe, inside out.
'Ishmael bought the house for £272,000 and spend £125,000 on the renovation
'and a further 13 grand on fees and expenses,
'making a grand total of £410,000.
'We asked two local estate agents
'to tell us what they make of the property
'and whether Ishmael has made a good investment.'
I think they're very nice and very well done,
I very much like the layout and the way it's done
and I like the colouring, too. It's nicely done.
First impressions are it's a very good conversion.
Slightly unusual layout on the basement and the first floor level,
the entrance level. The top floor level's very nice, three bedrooms,
nice finish in the bathroom, the kitchen's a good space
and it's laid out nicely, so I'm very impressed.
'Ishmael already has the top floor three-bedroom flat on the market.
'How much can he hope to get for it?'
The top floor flat, in its present state as a three-bedroom with a loft conversion,
I would value at between £275,000 to £300,000.
The top floor three-bedroom flat I believe will resale somewhere between £275,000 and £300,000.
I think that is good and I put them on the market £275,000.
So I believe they're the correct price.
'The estate agents reckon the five-bed flat split over the two lower floors
'could achieve between £300,000 and £340,000.
'Ishmael will rent this flat out on a temporary basis
'but still has his fingers crossed he'll get permission to split it into two flats,
'a one-bedroom on the ground floor and a two-bed garden flat.
'If he is successful, what could the two flats make?'
A one-bedroom ground floor apartment in the local area would sell for approximately £180,000.
The one-bedroom flat upstairs I believe would resell around the £200,000 to £215,000 mark.
'What about the two-bedroom garden flat?'
The lower ground floor with the two bedrooms and a garden
would sell for approximately £275,000.
I believe the two-bedroom flat with the garden on the basement level would achieve around £250,000.
'These valuations, added to their estimates for the top floor flat,
'would mean Ishmael has a building worth between £705,000 and £790,000
'if he can split it into three flats.
'His total outlay here was £410,000,
'which could mean a pre-tax profit of between £295,000 and £380,000.
'So there's no doubt that splitting it into three is worth holding out for.
'Even if he doesn't win his appeal, he could still make a healthy pre-tax profit
'of between £165,000 and £230,000 by keeping it as two flats. How does he feel about that?'
I really enjoyed it because I like the deciding and doing the designs,
deciding which kitchen you're going to put in. I really enjoyed this job.
So when I sell all the property, when I refinance, I'm looking forward to starting another project.
'Time now to return to Preston where earlier in the programme
'business partners Paul and Chris bought the ground floor flat conversion of this terraced house
'plus the freehold of the whole property for £41,000.
'Paul's an engineer who lives in Preston
'and his friend, Chris, is a stockbroker.
'They're part-time developers with two other rental properties.'
I actually came to have a look around and dismissed it
because my initial impression was that it was going to be a smaller place.
He rang me when I was having lunch at work and said, "The auction's in 45 minutes, what do you think?"
So we thought we'd give it a whirl.
'Two months later, we return to meet up again with them
'to see how the work's progressed.'
I think we've done a good job.
'Adding those new railings and the work they've done to the front garden,
'plus the new windows they've installed have given the property much improved kerb appeal.
'Inside, the large bay-fronted living room has been completely transformed.
'The floors have been sanded back and look fabulous.
'They've certainly brought the best out of the original features
'in this lovely room with its high ceilings.
'The bedroom has been redecorated and the kitchen has been completely refitted
'with new units, appliances and flooring.
'The tired old bathroom suite has been brought right up to date.
'It's all looking good, but it's not been easy getting here.'
We've had quite a lot of work to do in here.
The main thing we had to contend with at the start
was damp all along the back of these walls
and into the main part of the house, but it certainly was at its worst in the kitchen area.
We ripped the kitchen out and stripped the walls back to the brickwork, had it replastered.
It looked absolutely horrendous during the process
but I think we're pretty pleased with how it's turned out
and it gives a nice, fresh, contemporary look.
'The kitchen looks out onto the garden, which is a real bonus here.
'The upstairs flat only has access via a fire escape.
'Paul and Chris both have full-time jobs, so who did all the work?'
We basically aimed to get tradesmen to do all the work,
but given the timescale, there's certain people that you can't fit in.
So we picked up the jobs that we couldn't line someone up to do.
'So they ended up doing a lot of the joinery work, like skirting boards.
'Paul's done a lot of plumbing, rerouting the pipes in the kitchen and bathroom.'
So the layout of the bathroom stayed pretty much the same.
We've had to move the shower from this wall here, where the window overhangs the bath,
cos we wouldn't get a good seal there, and we moved it over to this wall
and built a false wall to support the shower and overhang the bath.
It's been quite a fiddly job cos it's quite tight in here
with the amount of plumbing work, but I'm really happy with the result.
'As Chris and Paul bought the freehold for the whole property,
'they're responsible for the communal areas.'
When we first came to the property, the whole place felt dingy,
so we've tried to add more light and just brighten everything up, box in all the meter cupboards,
also the floor, and we've treated the upstairs tenants to a new stair carpet, so they're delighted.
'Nice one, Chris. I thought there was scope for a basement conversion down here.
'Have they given any more thought to that?'
We've had the fire officer round from the council to have a look at what we need to do in terms of regulations
and we do have to plasterboard the roof of the cellar and do a bit of work
but we'll just keep that simple and get it done to the minimum we need.
'They paid £41,000 for the flat and the freehold of the whole property.
'How much did the work cost? Did they stick to their budget?'
We've still got a couple of bills to come in but we're looking on target for just over £10,000.
We could try and get all the walls perfectly smooth and all the rest but it's about getting the right balance.
We wanted someone to think, "It's a nice place, it's clean, it's bright, it's fresh."
They can put the pictures up they want to, put mirrors up.
We wanted to get it to a level where we could show people and hopefully they'll be pleased.
'Time to get some advice from two local property experts.'
I think the best selling point of the property is probably the lounge
with the fireplace and the high ceilings.
It sets a very nice tone for the whole property.
First impressions of the property are really good.
The refurb's been done really well, very quickly,
really good standard. It's very nice to see that they've made an effort
to keep the communal areas very tidy, very clean,
and I think as anyone comes to look at the property,
one of the first things they will notice is the communal areas are very well cared for.
I think with the kitchen, they've done a really good job. Kept it very simple
but still nice, modern units, it's nice and spacious
so you can get a dining table in there if you wanted to.
'Although Paul and Chris have added this to their buy-to-let portfolio,
'I'm sure they'd be interested to hear how much the flat is now worth.
'They paid £41,000 at the auction and have spent just over £10,000.
'So is the flat now valued above £51,000?'
From a resale point of view, as it stands, I would think that the current value is £65,000 to £70,000.
I think the resale value of this property is going to be in the region of £70,000.
'That valuation range of £65,000 to £70,000
'would represent a gross profit, before the usual selling expenses,
'of between £14,000 and £19,000.
'Could that sort of figure tempt them to sell?'
I wouldn't sell it for anything less than 80. 80-plus.
Upstairs sold for 86 without a freehold.
At the end of the day, we're not selling, so it doesn't really matter, but a bit disappointed.
But I wont lose sleep because I'm sure, by the time we sell it, it'll be worth a little bit more.
'The good news is that Paul and Chris have already found a tenant.
'Let's hope they haven't let the flat for less than they could have.'
From a rental point of view, I would expect the property to rent at £425 to £450 per calendar month.
I think the rental figure would be £450 per calendar month.
Yeah, that's not too far off. Obviously, it's rented already,
on day one of showing the first person, for £450. So that's OK.
'For their first purchase under the hammer, Paul and Chris had to race to the auction.
'So are they happy they crossed the finish line?'
Yeah, I'm absolutely pleased we decided to go for it.
Even though it was a last-minute one, it definitely was the right decision
and if I could buy another one of these tomorrow, I would.
-You'd buy another ten tomorrow!
We'll be back next time with more auction rooms all around the country.
-Join us then for more Homes Under The Hammer.
Subtitles by Red Bee Media Ltd
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Martin Roberts and Lucy Alexander visit a house in Cheshire, a property in London and a flat in Lancashire. All of these properties have been sold at auction, and Martin and Lucy find out who bought them and what they paid when they went under the hammer.