Episode 29 Homes Under the Hammer


Episode 29

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Transcript


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-We've witnessed the ups and downs of the property market.

-Buying for investment or as a home,

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you want the price to go up!

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Make sure you buy at the right price.

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Visit an auction room and buy your home under the hammer.

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-We're aware of the changing fortunes of the property market.

-Buying at auction is simple.

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-Your hand goes up. The hammer comes down. You've bought it.

-Just like when today's properties were sold.

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'In Cornwall, I'm gearing up for great things at this cottage.'

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You know what? As a start, this is great!

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'This bungalow in Staffordshire doesn't look quite so appealing.'

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It feels a bit makeshift, so not the best first impression.

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'And it's all about location, when it comes to this London flat.'

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This is a very desirable part of the capital.

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'These properties were sold at auction.

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

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I'm in Cornwall, about eight miles from St Austell, in Gorran Haven.

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Situated in a secluded bay between two sandy beaches,

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it's obviously a popular tourist spot.

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Big question is, what's it like when it comes to investing in property?

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# Everybody loves the sunshine... #

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'The natural beauty of the area will be sure to attract investors.

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'How will the property I'm here to view fare?'

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# ..Everybody loves the sunshine... #

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The property I'm here to see is on this row of fishermen's cottage.

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It all looks terribly quaint -

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until you look a bit closer.

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For a start, where's the front door?

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'This cottage was built in the 18th century,

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'when keeping it warm was a little more tricky.

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'My guess is that, to shelter occupants from bracing sea breezes,

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'the main entrance was put at the back.

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'So, the front door is the back door.'

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# Open up your back door... #

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Never know quite what to expect with these little cottages.

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A pleasant surprise - a big kitchen/dining room.

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We like this. I even quite like the kitchen units.

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It's got a bit of character, and fits in.

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Beams. It's looking good so far and it doesn't feel cramped,

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which is a major bonus.

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Through to the front, where you've got another open-plan room.

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Open stairs up to the bedroom and a nice big fire.

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A real fire, just what you want.

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But surpassing all of that is the view.

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Absolutely fantastic. You know what?

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As a start, this is great.

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'Cottages can often seem dark, but the open-plan layout

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'maximises the daylight and gives it a lovely bright feel.

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'So, what else is on offer?'

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Upstairs, it still has that nice feel.

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The white walls give a nice feeling of openness.

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Three reasonable sized bedrooms.

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What is unreasonable is the space wasted with this.

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That is a hot water cylinder. It's absolutely gargantuan.

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It looks old, so replace that with a combination boiler in the kitchen.

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You've now created much-needed space upstairs

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which, in a small house like this, is absolutely great news.

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'Another area where things feel a little cramped is the bathroom.

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'You can barely open the door.

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'Apart from losing a bedroom, I'm not sure you can do much about this,

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'apart from installing a shower instead of a bath.

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'It depends what you want to do with the place.

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'This could make an ideal holiday cottage,

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'a scenic seaside getaway.'

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# Down by the seaside

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# See the boats go sailing... #

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Clearly, that is the main asset to this property, the fantastic view,

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but it's not making the most of it.

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One thing that would be nice would be to have a front door.

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The only option is to take out one of these windows and put a door in.

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That could lead out onto some kind of a decking or a patio.

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What are you going to do here?

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Sit here with your cup of tea or glass of wine and look at that!

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'And it's not just the outdoor space at the front that has potential.

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'At the back, there's just the spot to while away a summer evening.

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'All it needs is a bit of landscaping.

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'This is ticking a lot of boxes so, with a guide price of 165,000,

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'I want to know what a local estate agent makes of it.'

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A holiday home is probably its primary function now.

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There'll be a good income potential.

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'What could a new owner do to increase value here?'

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The first thing would be to excavate space for parking at the front.

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It would be a huge bonus and increase the value.

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'The lack of parking could be a drawback,

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'especially if the owner was looking to let it out.

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'What sort of rent could they expect?'

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The rental for this property would be around £700 per calendar month.

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'How would that compare to the rate for a holiday let?'

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The holiday rental, roughly, in the peak season would be £750 per week.

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'That could make a lot of sense.

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'What about the resale value if they decided to refurbish and sell on?'

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If the property was renovated, the resale value would be £210,000 to £215,000.

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Not cheap, but a very appealing property that I think would make a very good investment.

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

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Fantastic location. Great sea and headland views. Three bedrooms.

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Who'll open the bidding? £150,000?

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£150,000 I'm bid. 160 anywhere?

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160 I'm bid. And 170?

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170? 170 I'm bid. And 180?

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I'll take five. Five? 175,000 I'm bid.

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180? 180,000 I'm bid.

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May I say 185? 185 I'm bid.

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And 190? 190? At £185,000.

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187 and a half. 187 and a half I'm bid.

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And 190? 190? £187,500.

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I'll take 1,000 if you like.

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188 and a half. 188 and a half I'm bid.

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190, madam? 190 I'm bid. May I say 191?

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191? £190,000 in the room.

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£190,000 for the first time.

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At £190,000 for the second time.

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And third and last time. Congratulations, it's yours at £190,000.

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'That successful bid of 190,000 came from Carolyn and husband Richard.

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'Richard's a sound engineer and song writer.

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'Carolyn's a self-employed consultant in the motor industry.

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'I met up with Carolyn at the cottage to hear about the plans for the place.'

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-Congratulations.

-Thank you.

-Tell me why you wanted to buy this place.

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We were looking as an investment as a holiday home

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in an area where you've got a sea view, pretty village.

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That certainly will attract the sort of audience we were looking for.

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-Why this part of Cornwall?

-It's completely unspoilt.

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Proper Cornish village. St Ives is very nice but also quite expensive.

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You've got Heligan, Eden Project, St Austell, all on your doorstep.

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So, really, it's the perfect place to be.

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Tell me about you, then. Is this something you do as a general rule?

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No, it's not! I've always worked for British motor manufacturers,

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which are no longer in existence.

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So I do consultancy work for either dealer groups or manufacturers,

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but I've always had an interest in interior and garden design.

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-What prompted you to do it now?

-I've been looking for quite a while.

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We live in Hampshire, where anything that comes up for renovation or restoration

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goes for absolute megabucks.

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So then you think we'll look on the coast for something we can use, for friends and a holiday let.

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'But holiday lets aren't all plain sailing.

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'There's a lot to consider, especially when you live 200 miles away.'

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-How long does it take to get here?

-Three and a half to four hours.

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Depending on the traffic and who's driving.

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Long-distance renovation can throw up some issues. How are you going to deal with those?

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We've been fortunate to find a local builder who has done work on these cottages and maintains them.

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So that's one hurdle.

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And obviously, I can live down here while renovation goes on.

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And managing the property once it's up and finished?

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We've discovered a lady who lives close that looks after holiday lets,

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and she's offered to do change-overs and maintain it for us.

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'The property might not be on her doorstep,

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'but with the right people on board, it could be a profitable venture.

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'Why was Carolyn attracted to this cottage?'

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It has a nice sea view.

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It's got lots of character. I felt it got everything that we needed.

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-And the negatives?

-Lack of parking.

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Which is a big issue. We're applying for planning permission.

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That was the biggest negative. We've found a few since, but no parking is the biggest issue.

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-How are you going to resolve that?

-I've spoken to Cornwall Council.

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They've asked me to drop them a line.

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They felt we might not need planning but we may need an engineer's report

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because of the proximity to the building.

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-So the idea is to dig out the front garden?

-A certain area, so you can get a car in.

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Then make a nice terrace with a door going through to it.

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'It wasn't just the parking that was a problem.

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'Carolyn has more to do to make this a successful holiday let.'

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We've got a chimney breast to take out to make more room in the bedrooms.

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Sort the garden out, so you've got a nice patio area.

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Just general refurbish throughout.

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One unusual thing is that there isn't a front door.

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My plan was to have a door put in, which meant moving the stairs.

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Because of the proximity to next door, that's a non-starter.

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So I'll take out this window and have that made into a door.

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'With a budget of £10,000 and three months to get the job done,

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'it's just as well Carolyn has found a reliable local builder.

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'He'll be in charge of a few major structural changes,

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'with a front door being put in and the driveway dug up.

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'What else does she have planned for the outside?'

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I used to think a garden was to sunbathe in and if my mother said to mow the lawn, I'd go to the pub!

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Now I've got an interest in gardens so I've put a design together

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to go with the property and make it a very pleasant sitting area.

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-Congratulations. We look forward to seeing how you get on.

-Thank you.

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With views like this you can understand why Carolyn would want to buy here.

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Running a holiday home makes financial sense, but it's a lot of hard work.

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How will she get on? Find out later in the show.

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'Staffordshire is in the heart of England.

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'Whilst Norton may not be the country's lifeblood,

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'its many transport links keep the area popular.

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'I'm here to see a property with a guide price that made my heart skip a beat.'

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It was £55,000, which I think is very modest.

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It looks like the property is, too.

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It's a one-bedroom bungalow. I'm going to check it out.

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'The front garden looks promising, but will this bungalow live up to its looks?'

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The main front door is accessing a lean-to with a cheap plastic roof.

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Not terribly welcoming and something I'd like to change.

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So you can keep prams and bikes out of the elements,

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but there's no huge advantage and it feels a bit makeshift.

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Not the best first impression.

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'It leads straight into the kitchen.

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'You don't want muddy boots traipsing through here.

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'No, no. This won't do.

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'A serious reconfiguration is needed, I'm afraid. But hang on.

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'What's this?'

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There has been major damage up there. Probably water damage. Possibly a leak.

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Have this checked out by a builder or a roofer before the auction.

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At the moment, it's a big unknown and the budget could spiral out of control.

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'This place really needs to be rescued.

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'The living room seems sad and soggy.

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'The only thing flourishing here are the mushrooms. Yuck!

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'The bathroom is suffering from a serious case of damp, too.

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'Quick! Someone call for help!'

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# Save me! Save me!

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# Save me...! #

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'The bedroom's escaped the worst of the damage,

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'but the whole bungalow needs to be thoroughly dried out before you think about improvements.'

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I look at property and always think, "How can I add some value?"

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I would like to add some extra square footage here. This is just a one-bedroom bungalow.

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I'd think about extending to the side. There's plenty of space.

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Then you could create a second bedroom.

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It could add £40,000 to the end value, so well worth considering.

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'You've still got a pleasant garden at the back,

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'so you won't miss the space at the side when the extension's complete.'

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It's a fairly small garden, what you'd expect with a house this size.

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I would like to have had a window

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on this back wall cos it's a bit bland to look at.

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I'm not sure if some reconfiguring would give you access into this garden. It really does need that.

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'This little bungalow needs new life breathed into it.

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'Time to get the opinion of a local estate agent.'

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The bungalow needs lots of work, repair and replacement throughout. It has had water damage.

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The ceiling needs to be repaired.

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I recommend a buyer checks the roof

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to see the extent of work needed.

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'Once the damage has been dealt with and the property renovated, how much could it be worth,

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'bearing in mind that guide price of just £55,000?'

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I would estimate the property be worth in the region of £90,000.

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'I see more potential here, so how much value could you add by increasing its square footage?'

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The main way to add value to the property

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would be to extend.

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It's only a one-bedroom accommodation, which is limiting for either rental or resale.

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After it's been extended, the property would be in the region of £125,000.

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'What about the rental potential?'

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The rental income as a one-bedroom property would be in the region of £400 to £450 per calendar month.

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As a two-bedroom property, it would be closer to 500, 550 per calendar month.

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I think this little home could make someone a pretty penny.

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It may be small, but if you were to extend, it could give a big return.

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Who wanted this? Let's find out, as we go to auction.

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Detached bungalow in need of attention. 50, can I say?

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Start me at 45. It's got to be worth that. 45 I'm bid. Thank you.

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At £45,000.

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Yeah. 50 I'm bid.

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Lady's bid now. At £55,000 seated.

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I'll take one if it helps. New bidder seated. £56,000.

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57. 58.

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59. 60.

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61. 62...

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62 and a half, then.

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63. Another half.

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63 and a half. 64.

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64,000, gentleman on the back row.

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At £64,000. New bidder.

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64 and a half. 65.

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70.

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75. 75, then, lady in red.

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At £75,000 first time.

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75 second time. Third and final time...

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Your lot, madam. Well done.

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'The successful bid of £75,000 was placed by retired shopkeeper Rose.'

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# Lady Rose

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# My lady Rose... #

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'She bought the property with her partner, Tom.

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'The couple live locally in a three-bedroom house and are looking to down-size.'

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Tom and Rose, lovely to meet you. Congratulations.

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-Why did you want this bungalow?

-We wanted somewhere small so we didn't have to do so much gardening.

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And less housework. We're getting older so we need less work.

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-You bought it to live in, Rose?

-Yes.

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-Tom, what do you like about this property?

-The same reason. Less work.

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'Hang on a minute. LESS work?

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'I can see that when it's completed this will be a low-maintenance home,

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'but it's going to take a lot of effort to transform it into the perfect retirement bungalow.'

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What can you tell me about the huge gaping hole in the hallway?

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-Is that water damage?

-Yes. What's happened over the severe winter,

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I think the house was left empty with the water connected.

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Everything froze up, pipe burst and goodness knows how long

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it was running from the ceiling, which caused the damage.

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All the floors were soaking wet,

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so probably a bit bleak underneath, I don't know till I take a board up.

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'Tom's a retired heating engineer, so knows about plumbing, and their son is an electrician.

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'So they've got several trades covered already.

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'Rose, who was born in Norton, will be responsible for the decoration and sorting out the garden.

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'How much are they going to spend on making this their new home?'

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At little as possible!

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Wants central heating straightaway so have to cater for that. New bathroom, kitchen.

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I'm looking at about 15,000, something like that.

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There's room on the side for an extension, probably at a later date.

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We want to do all the main work first,

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and then sit back and see what else can be done to improve it.

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'One of the improvements Tom and Rose are considering

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'is how to sort out the awkward layout.'

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I like the idea of a lounge on this side, a bit further back.

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Have this room as a bedroom and then the bedroom as a lounge.

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I think that's a great idea because to have some access at the back

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out to the garden is what is needed here.

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You've only got views to the front. It's quiet and green out the back.

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-And you can't see it!

-No.

-So that's a great idea.

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'The couple reckon they'll take four months to do the work.

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'With lots of family living locally and willing to help, they're relaxed about getting it done.'

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We're in no big rush to move in.

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We've got no reason to rush at our time in life, have we?

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You're supposed to be taking long holidays and you've taken a project like this, what are you thinking?

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-I think we needed motivating.

-Did you?

-Yeah.

-Why's that?

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Because we spend a lot of time doing nothing.

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You need a project, to be doing something to look forward to.

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-Tom, do you agree, or do you enjoy doing nothing?

-Well, I do enjoy reading me paper!

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-Is this Rose giving you a boot up the backside?

-She thought I was getting a bit thick round here.

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She said, "We'll buy a bungalow!"

0:22:270:22:30

I asked her before the auction if she really wanted to. She'd got her mind set on it, so here we are.

0:22:300:22:38

-Good luck with this project. I hope you do eventually get time to chill out.

-Thank you.

0:22:380:22:44

It's been really nice meeting you. Rose, thank you.

0:22:440:22:47

This is a homecoming for Rose. She is looking forward to living here.

0:22:470:22:52

There'll be no time for Tom to put his feet up and read that paper.

0:22:520:22:57

Will they extend and make the most of this bungalow? Find out later in the programme.

0:22:570:23:02

'Coming up, space is at a premium for flats in this part of London.'

0:23:040:23:09

Looking for more? There isn't any.

0:23:090:23:13

'We return to Staffordshire, where Tom and Rose are spending retirement turning this into a dream home.'

0:23:140:23:21

It was a nightmare!

0:23:210:23:23

'But first, it's been no holiday at this cottage in Cornwall.'

0:23:250:23:29

Living in a house that you're trying to renovate is not easy.

0:23:290:23:33

'Now we're back in Gorran Haven, Cornwall,

0:23:360:23:40

'where this cottage sold at auction for 190,000.

0:23:400:23:43

'It was bought as a holiday let by Carolyn, a consultant in the motor industry, and her husband.

0:23:430:23:50

'It had a lot going for it, including those wonderful views.

0:23:500:23:55

'The biggest issue the couple had was the four-hour commute from home to their new purchase.'

0:23:550:24:02

-What prompted you to do this now, this property development idea?

-I've been looking for quite a while.

0:24:020:24:09

We live in Hampshire, where anything that comes up for renovation or restoration

0:24:090:24:15

goes for absolute megabucks.

0:24:150:24:17

Then you think we'll look on the coast for something to use for holidays, friends and a holiday let.

0:24:170:24:25

-How long does it take to get here?

-Three to four hours, depending on the traffic and who's driving.

0:24:250:24:32

'So, did they manage the long-distance renovation?

0:24:320:24:35

'We're back four months later to see how their holiday let is faring.

0:24:350:24:40

'The front of the house has been transformed.

0:24:450:24:49

'Traditional white paint and new windows give the cottage a facelift.

0:24:490:24:54

'The most important change is the addition of a new front door.'

0:24:540:24:59

When we bought the house, all we had was two windows and no front door.

0:25:010:25:06

In the morning, it is beautiful so to come out to the front you had to walk all the way round.

0:25:060:25:13

It made sense to take out the window and put the door in.

0:25:130:25:17

Once we'd been here for a couple of weeks we realised, with an east wind,

0:25:170:25:22

that sashes look very nice but they weren't very practical.

0:25:220:25:26

So we took the decision to replace the rest of the windows.

0:25:260:25:31

'Inside, the living room isn't quite finished yet,

0:25:310:25:36

'but it's already a brighter space since the addition of the door.

0:25:360:25:41

'Once redecorated, this will be a warm and cosy room.

0:25:410:25:45

'The kitchen needed brightening up

0:25:460:25:48

'and Carolyn's done a great job.

0:25:480:25:51

'The paint, tiling and work tops

0:25:510:25:54

'have given the room a refreshing new finish.

0:25:540:25:57

'They've also put in a table and chairs

0:25:570:26:01

'to fully utilise the space.'

0:26:010:26:04

The kitchen was so dark, so that all had to go.

0:26:040:26:07

Re-tiled, new work tops, new sink.

0:26:070:26:10

Paint the units because they'd been hand-built,

0:26:100:26:14

and just redecorate.

0:26:140:26:17

'They've also rewired, fixed the plumbing and installed new heating,

0:26:170:26:22

'which means that old immersion heater has been replaced.

0:26:220:26:27

'The stairs have been cheered up with a new carpet and paint job.

0:26:270:26:33

'And that bathroom where you couldn't even open the door

0:26:330:26:37

'has been reorganised, with a shower installed and the bath removed.

0:26:370:26:42

'It's all so much better.

0:26:420:26:45

'The master bedroom has been redecorated with a splash of blue

0:26:450:26:49

'to give it some seaside style.

0:26:490:26:52

'This bedroom was mainly used for storage.

0:26:530:26:56

'Now, it's been redecorated and is a light well-proportioned double room.

0:26:560:27:03

'This room's floor space was restricted by the chimney breast.

0:27:030:27:09

'Carolyn had that removed, so there's room for two single beds,

0:27:090:27:14

'increasing the letting potential.'

0:27:140:27:16

One of the things with this room was the chimney breast across the corner

0:27:160:27:21

which looked nice with a Victorian fireplace, but it had to go.

0:27:210:27:25

Which wasn't easy because it was made out of stone.

0:27:250:27:29

It's made such a difference to open up that corner.

0:27:290:27:32

'Carolyn and Richard have lived here as much as possible

0:27:320:27:36

'to save commuting between Cornwall and Hampshire.

0:27:360:27:40

'They've done a really good job on the renovation, maximising their accommodation upstairs and down.

0:27:400:27:47

'Have there been any nasty surprises?

0:27:470:27:50

'What issues did they find most difficult?'

0:27:500:27:53

The plumbing and some of the wiring. They're the main horrors.

0:27:530:27:58

When you live four hours away, you can't just pop in, do a bit of work and nip home again.

0:27:580:28:05

Living in a house that you're trying to renovate is not always easy.

0:28:050:28:09

'Previously, Carolyn was determined to get a driveway at the front.

0:28:090:28:15

'There's no sign of that having been started,

0:28:150:28:19

'so have there been problems?'

0:28:190:28:21

We originally wrote to Cornwall County Council and they finally responded

0:28:210:28:28

to say we need to be referred to the Highways Department. I left several messages.

0:28:280:28:33

They sent me lots of forms to fill in.

0:28:330:28:36

Then they did a site visit and said, "No.

0:28:360:28:39

"It's nothing to do with us." And referred us to Cornwall Council.

0:28:390:28:43

'How frustrating!

0:28:430:28:45

'Carolyn and Richard decided to apply for full planning permission.

0:28:450:28:50

'Unexpected delays are common with renovation projects.

0:28:500:28:54

'Carolyn planned to spend two to three months on the work.

0:28:540:28:59

'Four months on, and there's still some left to do.

0:28:590:29:02

'Until the driveway's complete, plans for the garden are on hold.

0:29:020:29:07

'So, the timescale's slipped. What about the budget?'

0:29:070:29:11

The original budget was 10,000, including the parking.

0:29:110:29:15

Because we decided to do extra work like the new windows, the chimney breast, the bathroom,

0:29:150:29:21

I've spent just under 10,000! LAUGHS

0:29:210:29:25

So the parking will be in addition to that.

0:29:250:29:29

'So, with the purchase price of 190,000

0:29:290:29:33

'and a further £10,000 spent on the refurbishment so far,

0:29:330:29:37

'that makes a total spend of £200,000 plus the usual fees and expenses.

0:29:370:29:43

'So, have Carolyn and her husband added any value to the cottage?

0:29:430:29:47

'We invited two local property experts for their perspective.'

0:29:470:29:51

The improvements are very good.

0:29:510:29:53

It appears to be a lot lighter than when I was here last time.

0:29:530:29:58

It did feel a little oppressive when you came in, but that's all changed.

0:29:580:30:04

They made a really good job

0:30:040:30:06

of maximising the letting potential of the cottage.

0:30:060:30:09

It's got everything in the right places and the right scale.

0:30:090:30:13

'This holiday was bought as a holiday let investment.

0:30:130:30:17

'So, after the refurbishment,

0:30:170:30:19

'how much could they hope to get for it per week?'

0:30:190:30:24

In peak season, per week, £750 to £800 as a holiday let.

0:30:240:30:29

On a weekly basis, height of the holiday season,

0:30:290:30:32

the cottage would probably attract the better part of £800 per week.

0:30:320:30:37

If you take the front out and have the parking right by the door,

0:30:370:30:41

as much as £900 per week.

0:30:410:30:43

I'd be very happy with that. Yeah. Earn its keep.

0:30:430:30:48

'If they decided to rent this out in the more traditional sense, how much could they get per month?'

0:30:480:30:54

Per calendar month, you're looking at around £650 to £700.

0:30:540:31:00

I'd expect the cottage to achieve something in the region of £600, maybe £625 per calendar month.

0:31:000:31:08

'Obviously, they have no intention of selling this on any time soon.

0:31:080:31:13

'If circumstances changed and they were to put it up for sale,

0:31:130:31:17

'how much could the property achieve?'

0:31:170:31:20

The resale value is around £220,000.

0:31:200:31:23

As it stands today, the property has a value in the region of £220,000.

0:31:230:31:29

If they get permission to dig out the front and put parking right here

0:31:290:31:34

that value could increase to £240,000.

0:31:340:31:38

I'm not selling, but I think that's realistic.

0:31:380:31:41

'Things seem to have gone smoothly for Carolyn and Richard's first investment property.

0:31:410:31:47

'Are there plans for more?'

0:31:470:31:49

We'd certainly consider more properties.

0:31:490:31:52

Something perhaps a little closer to home, rather than a four-hour drive each way.

0:31:520:31:58

I wouldn't rule that out for the future.

0:31:580:32:00

'I'm in Islington, north London,

0:32:030:32:06

'a metropolitan area with easy access to the centre of the city.

0:32:060:32:10

'But it wasn't always like this.

0:32:100:32:13

'Originally, an agricultural village on the fringes of London,

0:32:130:32:17

'its main function was as a stop-off for cattle on their way to market.

0:32:170:32:22

'It might be more cars than cows, but it's a popular place to live.'

0:32:220:32:27

The property I'm here to see is in this block of flats.

0:32:270:32:31

They were built, the whole estate was, to house police workers.

0:32:310:32:35

They're now being sold as individual units.

0:32:350:32:39

The one I'm here to see, three bedrooms, guide price 325,000 quid.

0:32:390:32:43

Let's take a look.

0:32:430:32:46

'Although the building might not win architectural awards,

0:32:490:32:52

'it does benefit from a green at the front.

0:32:520:32:56

'Appearance wise, it's not a great start, but for a guide price of 325 grand for a flat

0:32:560:33:02

'surely you'd expect something enticing inside.'

0:33:020:33:06

If you're not from London, there's a few things you've got to understand.

0:33:060:33:11

This is a very desirable part of the capital.

0:33:110:33:15

So you don't really get a heck of a lot for your money but bear with me.

0:33:150:33:21

Front room there. Kitchen there. Then down this corridor

0:33:210:33:26

which, to my mind, takes up a bit too much space.

0:33:260:33:30

Bathroom there, then three bedrooms.

0:33:300:33:32

You're looking for more? There isn't any.

0:33:320:33:36

Still, remember, smart part of London.

0:33:360:33:40

'It's not pretty but it's got potential.

0:33:410:33:45

'Getting rid of that sofa will free up some space in the hall.

0:33:450:33:51

'Once you have a good look around, the layout works well.

0:33:510:33:56

'There's a lot of light. The bedrooms are doubles.

0:33:560:33:58

'The flat's in poor condition and the decor is tatty, but structurally

0:33:580:34:03

'everything seems in good shape.'

0:34:030:34:06

They say that a kitchen is the heart of any home.

0:34:060:34:11

If that's the case, then this flat is not so culinary as having a bit of a coronary.

0:34:110:34:18

Yes. Not ideal.

0:34:180:34:20

'With the rest feeling spacious, it's a shame to be let down by the kitchen.

0:34:200:34:26

'But a change of layout, new units, some sparkling white goods

0:34:260:34:31

'and you never know, the heart could learn to beat again.'

0:34:310:34:36

The lounge is a major selling point for this property.

0:34:400:34:44

A good size. Needs a few features being updated.

0:34:440:34:48

Like the gas fire there.

0:34:480:34:51

But you've got a lot of light coming in.

0:34:510:34:53

Views over the gardens and somebody else's garden.

0:34:530:34:57

At least you've got a balcony.

0:34:570:34:59

It needs cosmetic work, certainly the kitchen and bathroom,

0:34:590:35:04

but not too bad - for the money.

0:35:040:35:08

'And that guide price of 325 grand is growing on me, too.'

0:35:080:35:14

-# You're really growing on me

-I'm really growing on you

0:35:140:35:17

-# You're really growing on me

-I'm really growing on you... #

0:35:170:35:22

What else? It's a flat so there are costs associated with owning it.

0:35:250:35:30

£500 a year is the management charge, so not too bad. The ground rent is only £1 a year.

0:35:300:35:37

The property is leasehold but nine years ago

0:35:370:35:40

that lease was renewed so it's now 125 years, minus nine years.

0:35:400:35:45

That is really nothing to worry about.

0:35:450:35:48

'So, that's the lowdown.

0:35:480:35:51

'But with a guide price of 325,000,

0:35:510:35:54

'what does a local estate agent make of it?'

0:35:540:35:57

It needs a lot of work doing to it but the structure is very good,

0:35:570:36:03

the room proportions are very good, it just seems like cosmetic stuff.

0:36:030:36:09

'With a little help in the looks department,

0:36:090:36:12

'could this be an attractive investment for sale or rental?'

0:36:120:36:16

Flats are popular in Islington.

0:36:160:36:19

This place is going to appeal to sharers.

0:36:190:36:22

When you're living in an expensive part of London, being able to share the rent or purchase price is key.

0:36:220:36:29

'How much rental return could you achieve on a flat like this?'

0:36:290:36:34

Somewhere in the region of about £2,000 per calendar month.

0:36:340:36:39

'If it was renovated and resold, how much might you expect to make?'

0:36:390:36:44

Refurbished to a decent standard, you could look at a resale value of between £430,000 to £450,000.

0:36:440:36:51

If you can look past the condition and forgive the fact that there's no outside space,

0:36:510:36:57

I think it could be interesting to go for.

0:36:570:37:00

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

0:37:000:37:05

A second-floor, three-bed, purpose-built flat.

0:37:050:37:09

Needs a bit of upgrading.

0:37:090:37:11

Over to you. 300, then?

0:37:110:37:14

300 sitting down. 305?

0:37:140:37:17

305. 310. 315. 320.

0:37:170:37:22

325? 330?

0:37:220:37:25

335? 340?

0:37:270:37:30

345? 350?

0:37:300:37:33

355? 360?

0:37:350:37:38

365?

0:37:380:37:40

370!

0:37:400:37:42

375?

0:37:420:37:44

376?

0:37:450:37:47

377?

0:37:470:37:50

378?

0:37:500:37:52

379?

0:37:520:37:54

380? 381 on the phone?

0:37:540:37:57

382?

0:37:590:38:01

382, new spot. 383?

0:38:020:38:05

384? 385?

0:38:060:38:09

386? 387 on the phone?

0:38:090:38:13

388? 389?

0:38:130:38:16

390?

0:38:160:38:18

391 on the phone?

0:38:190:38:22

392 in the room?

0:38:220:38:24

If not, 391 to the phone. First time...

0:38:250:38:29

392 in the room.

0:38:290:38:32

393?

0:38:320:38:33

392 in the room. Anyone else? 392 first time.

0:38:350:38:40

Second time. Going to lose it.

0:38:400:38:42

Third and last time, if you're all done. Sold.

0:38:420:38:46

392.

0:38:460:38:48

'Well, he almost let it go but after a last-minute decision,

0:38:480:38:53

'the successful bid of £392,000 was placed by Yemi.

0:38:530:38:57

'He's an acquisitions agent and bought it on behalf of a client.

0:38:570:39:01

'I met him to discuss what he's got planned for this purchase.'

0:39:010:39:07

-Congratulations.

-Thank you.

-Tell me why you wanted to buy the flat.

0:39:070:39:11

We bought for a client. He was looking for a good location close to the City.

0:39:110:39:16

What was the remit that you had? What property was he looking for?

0:39:160:39:21

Something with a good cash flow, a good rental income.

0:39:210:39:25

-In a good location with proper equity appreciation.

-Right.

0:39:250:39:32

-Why did you pick this place for him or her?

-I love the location.

0:39:320:39:37

I love the square. It's not the best property in the neighbourhood.

0:39:370:39:42

Close to the station, close to the City,

0:39:420:39:46

the high street shops and all that.

0:39:460:39:48

-And very expensive houses about.

-Yes.

0:39:480:39:52

# I'm a fixer

0:39:520:39:54

# And I've only just begun

0:39:540:39:57

# I just snap my fingers And the fixer gets it done. #

0:39:590:40:04

'It's about location and a good rental income for Yemi and his client.

0:40:040:40:09

'What do they intend to do here?'

0:40:090:40:13

We're looking at fitting in a second WC

0:40:130:40:17

and making the big room an en suite.

0:40:170:40:19

Wow. Putting an en suite in. That'll be nice.

0:40:190:40:22

Another thing we're going to do is change the system.

0:40:220:40:26

The heating system at the moment is the tank system. We're changing it to a combi system.

0:40:260:40:33

-Create a bit of extra space.

-Yes.

0:40:330:40:35

The kitchen, not ideal. What are you going to do with that?

0:40:350:40:39

We'll update the kitchen.

0:40:390:40:42

Change the floors to wood floors in the hallway and the living room.

0:40:420:40:47

-And new carpets, new decor.

-Right.

0:40:470:40:50

-What kind of cost is it coming in at?

-We're looking at 20.

-20.

0:40:500:40:55

-What kind of timescale?

-Three, four weeks, max.

0:40:550:40:58

-Three or four weeks?

-Yes.

-Quick in and get it sorted?

-Yes.

0:40:580:41:02

-Is the idea to get a tenant in...?

-Yes. We have interest already but we'd rather update the flat.

0:41:020:41:08

'I think £20,000 is a healthy budget but three to four weeks is tight.

0:41:080:41:14

'Yemi seems confident though

0:41:140:41:16

'that with builders who work on his projects he'll meet the deadline.

0:41:160:41:21

'He thinks it's worth the investment for the postcode alone, as his client was only too aware.'

0:41:210:41:28

-What did you think about the price? It went above the guide price.

-The client wanted it.

0:41:280:41:34

And he was there at the auction on the day.

0:41:340:41:37

He went slightly over our... our budget. About 10,000 over.

0:41:370:41:44

-Right.

-But we paid the premium for the area.

-Great.

0:41:440:41:48

-Congratulations. Good luck with it.

-Thank you.

0:41:480:41:51

Well, as the old adage goes, it's all about location.

0:41:510:41:55

Islington seems to have fared pretty well in the tough market conditions of late.

0:41:550:42:01

It's a lot of money, and there's more to spend on the refurbishment.

0:42:010:42:06

How will the valuations stack up once it's completed? Find out later in the show.

0:42:060:42:12

We hope our buyers set themselves realistic timescales and budgets.

0:42:150:42:20

There is only one way to find out - catch up with them after all the hard work.

0:42:200:42:26

'Earlier, we were in Staffordshire in the village of Norton.

0:42:260:42:32

'We met local couple Tom and Rose, looking to down-size from their family home.

0:42:320:42:37

'They'd bought this one-bedroom bungalow for 75,000.

0:42:370:42:41

'What they got was a hole in the ceiling and damp,

0:42:410:42:45

'damp, damp.

0:42:450:42:47

'A challenge for anyone, but especially for a retired couple.'

0:42:470:42:52

You're supposed to be taking long holidays and you've taken a project like this. What are you thinking?

0:42:520:42:59

-I think we needed motivating.

-Did you?

-Yeah.

-Why's that?

0:42:590:43:03

Because we spend a lot of time doing nothing.

0:43:030:43:05

You need a project, you need something to look forward to.

0:43:050:43:11

-Tom, do you agree, or do you enjoy doing nothing?

-I do enjoy reading me paper.

0:43:110:43:17

'Tom and Rose hoped to move in when work was completed on their four-month schedule.

0:43:190:43:25

'But nine months later we got the call to say that their renovation was breaking news.

0:43:250:43:32

'It's turned out to be much more than just a renovation.

0:43:340:43:38

'The bungalow has an entrance on a side extension

0:43:380:43:42

'and a first floor has been added - truly impressive.

0:43:420:43:46

'And inside...

0:43:460:43:48

'that extension means that the old bedroom

0:43:480:43:52

'is a large lounge with front and back aspects.

0:43:520:43:55

'The former lounge is a dining room and a corridor from the front door.

0:43:570:44:02

'The kitchen still has some way to go.

0:44:040:44:07

'The old bathroom is transformed into a smart and modern shower room.

0:44:100:44:15

'Tom and Rose are rightly proud of their hard graft.'

0:44:160:44:20

This is the new extension.

0:44:200:44:22

Here we have a recess.

0:44:220:44:26

The front door comes into the hall here.

0:44:260:44:31

I thought it nice, rather than coming straight into the lounge.

0:44:310:44:36

The French windows I particularly like because of the patio area

0:44:360:44:40

that hopefully we will have.

0:44:400:44:43

It's a south-facing wall, so when the sun shines we get it all day.

0:44:430:44:49

As you can see, it's nice, it's light, it's bright.

0:44:490:44:53

And when the furnishings are in, the curtains, carpets,

0:44:530:44:57

I think it'll be nice.

0:44:570:44:59

'From outside the living room, you see how impressive the extension is.

0:44:590:45:04

'What a difference an extra floor makes!

0:45:040:45:07

'Back inside, a new staircase leads up to two bedrooms -

0:45:070:45:11

'a double

0:45:110:45:13

'and an even larger double-size bedroom.

0:45:130:45:16

'And also there's a new bathroom.'

0:45:160:45:19

It's virtually a new building - all new, all the woodwork, the roof.

0:45:190:45:25

All the walls, completely new. Every bit of timber in the house is new.

0:45:250:45:31

Except the floorboards downstairs.

0:45:310:45:34

'That's not my idea of down-sizing.

0:45:360:45:39

'What made Tom and Rose throw away their original plans?'

0:45:390:45:44

The architect came up with such a good plan we decided to go with it.

0:45:440:45:50

'With their finances bolstered by some investments maturing,

0:45:500:45:54

'they decided to go for a full loft extension.

0:45:540:45:57

'They were taking to developing like ducks to water -

0:45:570:46:01

'and there was plenty of that!'

0:46:010:46:03

Because it was so wet, we had to take most of the floorboards up

0:46:030:46:08

to dry out because all the joists underneath were wet.

0:46:080:46:14

So that was quite a big thing.

0:46:140:46:17

And then we put it back together.

0:46:170:46:20

Then they took the roof off and then it rained and rained and everything got wet again.

0:46:200:46:26

# I can't stand the rain against my window... #

0:46:270:46:33

'Everything seems right as rain now and there are no holes in the roof.

0:46:330:46:38

'The work was a family effort, and Tom and Rose were glad of the help,

0:46:380:46:43

'especially as the project was bigger than expected.'

0:46:430:46:47

This is part of the new building.

0:46:470:46:50

The bathroom is all completely new.

0:46:500:46:53

My brother gave me a hand doing the tiling.

0:46:530:46:57

I finished off with the plumbing with his help as well.

0:46:570:47:01

'Builders were contracted to do the build,

0:47:010:47:05

'while Tom and Rose's son did the electrical work.

0:47:050:47:08

'Apart from finishing off the kitchen,

0:47:080:47:11

'reinstating the lean-to and turfing the garden,

0:47:110:47:16

'there's not much else to do before they can move in.

0:47:160:47:19

'So, with the job taking nine months, five more than planned,

0:47:190:47:23

'was Tom pleased with Rose's retirement project?

0:47:230:47:26

'What were his favourite moments?'

0:47:260:47:29

There wasn't any. It was a nightmare.

0:47:290:47:33

'Don't worry, Tom. You'll soon be back to that newspaper.

0:47:330:47:37

'But one good thing has come out of it.'

0:47:370:47:40

I've lost a bit of weight. That's the best thing for me.

0:47:400:47:44

'Tom has found a new weight-loss programme

0:47:440:47:47

'but when it comes to losing pounds, surely this took the biscuit.

0:47:470:47:53

'The original budget for a much smaller extension was 15,000.'

0:47:530:47:58

The thing snow-balled, with going up in the roof.

0:47:580:48:02

You've got to be looking at 50,000, so it's gone a lot over.

0:48:020:48:08

'Tom and Rose bought the bungalow for 75,000,

0:48:100:48:14

'so that 50-grand renovation pushes their total outlay to 125,000.

0:48:140:48:20

'Time to find out what two local estate agents think of their efforts.'

0:48:200:48:26

Really impressed with the property. It's been completely transformed.

0:48:280:48:33

By the standard of what they've done it's going to be a fantastic job.

0:48:330:48:38

I think the property has been done to a really good standard. It's almost like a new-build.

0:48:420:48:49

On completion, it'll be ready to move straight into.

0:48:490:48:54

My favourite bit has got to be the lounge.

0:48:540:48:58

It's different than your standard square box.

0:48:580:49:01

There's plenty of light. It's got nice views of the back garden.

0:49:010:49:06

'Having spent 125,000, what could they get if they decide to sell it?'

0:49:060:49:12

On the open market, I'd recommend an asking price of £149,950.

0:49:130:49:20

On the sales market, I would estimate an asking price in the region of £150,000.

0:49:200:49:26

It's not a seller's market at the moment.

0:49:260:49:30

It's a buyer's market, so they'd try to knock you down, I would think.

0:49:300:49:35

'If they chose to rent it out, they could expect £600 a calendar month.

0:49:350:49:40

'But they've no plans to do that.

0:49:420:49:45

'From a modest bungalow, they've created a lovely two-bedroom house to call home.

0:49:450:49:51

'And they seem to have made a decent investment into the bargain.

0:49:510:49:55

'It's time they put their feet up and enjoyed the benefits.

0:49:550:49:59

'What does Rose think the future holds?'

0:49:590:50:03

Sitting in there with the sun shining through those patio windows.

0:50:030:50:08

Hopefully!

0:50:080:50:10

'Now we're back in Islington, north London,

0:50:150:50:18

'where this spacious but shabby three-bed flat sold for £392,000 at auction.

0:50:180:50:24

'I met Yemi, an acquisitions agent who bought it on behalf of a client

0:50:240:50:30

'who was hoping for good returns on his investment.'

0:50:300:50:33

-Tell me why you wanted to buy it.

-We bought for a client.

0:50:330:50:37

He was looking for a good location, close to the City.

0:50:370:50:40

What was the remit? What kind of property was he looking for?

0:50:400:50:45

Something with a good cash flow, a good rental income,

0:50:450:50:49

in a good location with proper equity appreciation.

0:50:490:50:55

'Yemi was under pressure to stick to a budget and turn it around

0:50:550:51:00

'to make sure the flat was earning money for his client.

0:51:000:51:04

'So we're back just five weeks later to see how he got on.

0:51:040:51:09

'Yemi has banished the heartache that was the old kitchen

0:51:150:51:20

'and brought the space back to life

0:51:200:51:22

'with contemporary units and a stylish finish.'

0:51:220:51:25

We were able to update the kitchen,

0:51:280:51:31

create more room, give it a city feel.

0:51:310:51:35

'The living room looks much better, having been completely redecorated.

0:51:350:51:40

'The old fireplace has been removed and the walls given a lick of paint.

0:51:400:51:45

'New wooden floors help create a smart living space.

0:51:450:51:49

'The hallway needed sprucing up and with a paint job and flooring,

0:51:490:51:53

'it's now a bright and inviting entrance way.

0:51:530:51:57

'Yemi got rid of the old airing cupboard to make a new shower room.

0:51:570:52:01

'It's an economic and stylish use of space.'

0:52:010:52:05

Taking out the airing cupboard really enhanced the flat.

0:52:050:52:09

A three-bed flat could do with two utilities, and that's what we were able to get.

0:52:090:52:15

'Which leads us on to Yemi's second stroke of genius.

0:52:150:52:18

'That sofa's been banished

0:52:180:52:20

'and the separate toilet and bathroom blocked off

0:52:200:52:24

'to create an en suite in the first bedroom.

0:52:240:52:27

'Sticking to the same style as the main bathroom,

0:52:270:52:30

'the en suite is a welcome addition.

0:52:300:52:33

'The creation of a second bathroom in a small space is fantastic.

0:52:330:52:38

'The en suite bedroom just needed refreshing.

0:52:380:52:42

'New carpet and light walls have done just that.

0:52:420:52:47

'Bedroom two needed brightening up.

0:52:470:52:49

'With a lick of paint and new carpet it looks modern and clean.

0:52:490:52:54

'The third bedroom is small but with a new carpet and decoration,

0:52:540:53:00

'it feels lovely and light now.

0:53:000:53:04

'So, this place feels completely different.

0:53:040:53:07

'It's a much more contemporary living space.

0:53:070:53:11

'It seems that Yemi's done a great job. Did he encounter any problems?'

0:53:110:53:16

The neighbours were not happy works being done on Saturdays.

0:53:160:53:20

So that we lost a day a week on that basis.

0:53:200:53:24

But we got by pretty well.

0:53:240:53:28

'Yemi's fixed it to make sure everything worked out.'

0:53:280:53:32

# I just snap my fingers

0:53:330:53:36

# And the fixer gets it done. #

0:53:360:53:38

'Job done, Yemi.

0:53:400:53:43

'He's done this place up very efficiently. What's the secret to his success?'

0:53:430:53:49

To have builders that deliver on time and would not cut corners, I think is a plus.

0:53:490:53:57

'Having a good team is an advantage when it comes to renovations.

0:53:570:54:02

'Yemi's contacts and experience paid off.

0:54:020:54:05

'When we first saw the property, he estimated

0:54:050:54:08

'the project would take about a month and cost £20,000.

0:54:080:54:12

'Now the work's finished, how are those targets looking?'

0:54:120:54:18

We actually saved cost. It cost less than £17,000.

0:54:180:54:23

And the project was delivered in three weeks.

0:54:230:54:28

'Yemi's client paid £392,000 for the property plus another £14,000

0:54:280:54:34

'in fees and stamp duty.

0:54:340:54:36

'Adding the £17,000 cost of the renovation

0:54:360:54:40

'brings his total outlay to £423,000.

0:54:400:54:43

'Was it a wise investment?

0:54:430:54:45

'We invited two local property experts for their views.'

0:54:450:54:51

They've done a really good job with the refurbishment.

0:54:510:54:54

The addition of a second bathroom

0:54:540:54:56

is key if they're looking at professional sharers.

0:54:560:54:59

It's a good level of finish and very appealing.

0:54:590:55:02

I think it's been refurbished to a fairly high standard.

0:55:020:55:07

It's got an en suite, a bathroom,

0:55:070:55:09

wood flooring, it's in the right area.

0:55:090:55:12

I like the kitchen. Neutral colours. It should sell quite easily.

0:55:120:55:18

'Yemi's client always intended this flat to be rented out.

0:55:180:55:22

'So, according to the experts, how much rental return could they expect per calendar month?'

0:55:220:55:29

I would put it on the market for £2,000 per calendar month.

0:55:290:55:33

This property can be rented out per calendar month for £2,400.

0:55:330:55:39

'That's an impressive maximum yield of just under 7%.

0:55:390:55:44

'Will it be enough to keep Yemi's client happy?'

0:55:440:55:48

He's exceeded our expectations at 2,400.

0:55:480:55:53

'If they changed their mind

0:55:530:55:55

'and put the flat up for sale what could they hope to get?'

0:55:550:56:01

Somewhere in the region of £430,000.

0:56:010:56:05

This property we would market at about £465,000.

0:56:050:56:11

Looking to realise about 450 to 455.

0:56:110:56:13

Not bad. Not bad for an investment you bought five weeks ago.

0:56:130:56:21

'So, with the flat now finished, on time and within budget,

0:56:210:56:25

'how does Yemi's client rate the experience?'

0:56:250:56:28

The client is very happy.

0:56:280:56:30

He's happy because the flat's come out good in a short time frame.

0:56:300:56:36

He's convinced, as we are, that we'll be able to get good tenants

0:56:360:56:41

that will take care and appreciate the money he put into it.

0:56:410:56:46

Those stories have been added to our Hammer archives.

0:56:480:56:51

We'll have plenty more next time on Homes Under The Hammer.

0:56:510:56:56

-Goodbye.

-Goodbye.

0:56:560:56:58

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0:57:160:57:19

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0:57:190:57:22

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