Episode 3 Homes Under the Hammer


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Episode 3

Martin Roberts and Lucy Alexander visit an old cottage in Cornwall, a house in London and a one-bed flat in Derby. They find out who bought them and what they paid.


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Transcript


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We're always being told to save for the future.

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These days, people are searching for ways to supplement or replace their pensions.

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Property is an attractive option.

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That's why so many people buy their homes under the hammer.

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If, like us, you hope property is a safe investment, you must choose wisely.

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That means doing your research to search for the bargains.

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-What did our buyers on today's show find?

-Let's take a look.

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'In Cornwall, this old cottage has some unexpected accommodation.'

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Curiouser and curiouser.

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'This London house can't conceal its troubled past.'

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You can see the extent of the damp, mould and condensation.

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'In Derby, this one-bed flat might suit a buyer with a big appetite.'

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Perfect if you're serving roasted elephant! Absolutely massive.

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'All these properties went to auction.

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

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'I'm in a village called Pool, near Redruth in Cornwall.

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'Copper and tin mines made the area rich.

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'The South Crofty Mine was in operation for 400 years,

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'but closed in just 1998.

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'Controversy has raged about what to do with the site.

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'Since exploratory drilling found traces of gold there's excitement

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'that maybe the area is about to strike it rich again.

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'Will I strike gold with this auction lot?'

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The property is on the main road in and out of town.

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As you can see, very busy and noisy.

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The slightly good news is that the property is set back from the road, although not that far.

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Looks a bit of a state from outside.

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End terrace, two bedrooms, guide price of 50,000 to 70,000 quid.

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Wish me luck.

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'The property has a certain character appeal,

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'but the rendering and the state of the windows concern me.

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'Inside may have a little more character than is really desirable.'

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Intriguing. Right.

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Little corridor there, then through this...

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extra door, stairs to the bedrooms.

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I'm already feeling very claustrophobic.

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This is a very old cottage, about 1700.

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Typical of this area. Look at the thickness of those walls!

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The bad news is that's probably not damp proofed.

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This is your living room area.

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Love this! That's actually going to...

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That's going to another socket.

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Not sure that quite meets current regulations.

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-LAUGHING:

-No!

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But anyway, through to the kitchen. Mm-hm.

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Tiny, tiny, tiny, tiny.

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You'd have to be very small to live here without banging your head.

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I'm not getting a good feel about this place.

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Very dry?

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-LAUGHS

-Yes. I'll tell you what.

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Judging by the smell and that damp on the walls,

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I beg to differ.

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'And what a lethal combination!

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'Sopping wet walls and dodgy electrics.'

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# She's electric... #

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'I reckon this property has had a stormy past.

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'It still looks very unsettled.

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'The yard doesn't get any better.

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'It's full of sheds, and an outside loo.

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'It looks like the washing machine used to live here.

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'On the left-hand side,

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'there's a second reception room in a similar state.

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'Maybe you can move the kitchen into the first reception room

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'and create a utility room in the kitchen.

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'And it's all getting very weird in the hallway.'

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Curiouser and curiouser.

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At the end of the entrance hall is this cupboard.

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Nothing too unusual,

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until I tell you the ceiling is the next-door neighbour's property.

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It's a "flying freehold" over your house.

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Not too much of a problem, unless they have a party up there.

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It IS a problem because mortgage companies don't like flying freeholds.

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In this case, not a problem. Don't think it's mortgageable anyway!

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'So, along with the flying freehold and other structural issues,

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'I reckon it's nigh-on impossible to get a mortgage on this, with a guide price of 50 to 70 grand.

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'What joys await upstairs?'

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Up this cute little staircase... Mind me head.

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..to two bedrooms.

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Surprisingly, they're not too bad, in terms of size.

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But the doors to them - how cute is that?

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That's possibly a bit more serious.

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Nasty cracking going on in this end wall.

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That's probably just the plaster.

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Take that off and see what the brickwork underneath is like.

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Not a bad sized room.

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Built-in cupboard, which is nice to have.

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The one thing I haven't found yet... is the bathroom and loo.

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It isn't downstairs. It isn't upstairs. There isn't one.

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That's not good, is it?

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'If you need to spend a penny, that requires a trip to the outside loo.

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'Never ideal on a winter's night.'

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# But, baby, it's cold outside... #

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'As well as this inconvenience,

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'the bedrooms appear to have damp issues

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'and are a cause for concern.

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'I asked a local estate agent to give us his view

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'on what it would take to bring it up to scratch.'

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My first impressions of the property,

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needs a lot of money spending on it, there's damp issues throughout.

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Two options for the bathroom. You have a kitchen in an outbuilding.

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Bring that inside, creating the bathroom there,

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or between the two bedrooms, above the stairwell.

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'Once the house has been sorted out,

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'could it appeal to the local market for people looking to rent?'

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There's certainly a good rental potential for this property,

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with the college within a stone's throw.

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A monthly income, you'd be looking in the region of £550.

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'So, renting's an option.

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'What could the sale value be, once the house is refurbished?'

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I would look to market this property in the region of £120,000.

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Wow! Well, this is a project and a half, for sure.

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Not only is a major refurbishment required, but you're also creating whole new rooms

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before you can drag this place into the 21st century.

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Who fancied taking it on? Let's find out when it went to auction.

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So it's the end of terrace.

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Two bedrooms upstairs.

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A kind of kitcheny thing on the back and quite a good sized yard.

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Not going to start less than 50.

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50, thank you. 50 I've got. At 50. At 50. Two.

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54. At 54. At 54. At 54,000, then.

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56 to your right. You saw it. 56.

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At 56. Gentleman on the wing, there. At 56. At 56.

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At 56. At 56 once...

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I'll take seven if it helps.

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At the moment, gentleman on the wing's got it. At 56 on my left.

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First time. And the second time. You are going to miss this cottage.

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At 56, sure and done. Congratulations, sir.

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'That successful bid of 56,000 was made by Gordon,

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'who was at the auction with his partner, Valerie.

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'He lives 18 miles from Redruth.

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'He's always been interested in property developing and has renovated his own house.

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'He used to be a milkman but, after hip problems, was forced to retire

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'and decided to focus on property developing.

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'He has six that he rents out. I met him and Valerie at his latest purchase.'

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-Gordon, Valerie, lovely to meet you.

-Pleasure to meet you.

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-Tell me why you've bought it. Is it somewhere to live?

-No.

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-It's an investment.

-Really.

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Valerie, she's not too keen, but she follows me.

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-Right.

-She'll pitch in her ideas but I think, sometimes, she wishes I'd go and sit down.

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You have got other properties.

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He likes to have an old place, do it up and make it look nice.

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-How many times have you done this kind of thing?

-Well, I've...

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-Six.

-I've got six buy-to-let properties.

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Some of them have needed a lot and some haven't needed so much.

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Sometimes, I say, "Let's get one you haven't got to do anything to.

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"Just a lick of paint." You can get them. That doesn't satisfy him.

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He likes ones that you've got to pull this down, look in there.

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It's very satisfying to me. This was a chance.

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-I didn't come inside before I bought it.

-You didn't come inside?

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You're going to say, "You're mad!" But I didn't. I ran out of days.

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The day of the auction, 20 minutes before he should be there, he walked up the alley.

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I looked at the roof. It's sound.

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'The roof does look sound, but it's probably the only thing that is.

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'Buying a property without seeing it is never a sensible idea.

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'Some do get away with it but, judging by the state of this,

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'Gordon has taken on a challenge, to say the least.

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'It hasn't even got a bathroom.'

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Tell me exactly what you're going to do.

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Well, we intend to put a shower room with a wash basin and toilet

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that can be accessed from both bedrooms.

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-Have a Jack and Jill bathroom.

-Over there somewhere.

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There'll be a lock inside each door just across here, if we can work it.

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'A Jack and Jill bathroom doesn't mean you have to go up a hill to get a pail of water!

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'It's a bathroom with two doors,

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'accessed from both bedrooms, when space is limited.

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'What about downstairs?

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'Well, the living room has damp, and dodgy wiring.

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'There's that strange cupboard plus a room that looks onto the road.

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'What are Gordon's ideas?'

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As you come in, we're planning to take the partition down and make that a lounge.

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-Great.

-Which will open that up.

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This cupboard, we're planning to make the door higher

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so that can be a walk-in cupboard for boots and vacuum cleaner.

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We're planning to have a lounge-diner under here

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with a utility at the back.

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A new outside toilet, so there is a toilet on the ground floor.

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Take away at least one of the sheds

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and make that into a nice sitting-out area.

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-How much are you going to spend?

-We reckon 30,000, 35,000.

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-It's a lot of money.

-With that, we ought to be able to make it a good property.

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-What's your involvement, Valerie?

-Making the tea and coffee, I expect.

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-Good luck, and we look forward to seeing how you get on.

-Thank you.

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-Thank you.

-Thank you.

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# ..Leave the door on the latch I'll be

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# Back before the milkman I expect... #

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'My goodness! Gordon and Valerie have taken on a heck of a project

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'and hope to get it all done in around 12 weeks.

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'They have sensibly set a decent budget of £35,000.

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'But who knows what may surface?'

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Just as well that Gordon likes a challenge. He's got one here.

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He does have some really good ideas

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and as long as Valerie can keep him in check when it comes to the budget

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there could be money to be made, but not without a fight.

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Find out how they get on later in the show.

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'I'm in East Finchley, London,

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'home to one of the most expensive roads in Britain.'

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# Money, money, money Must be funny... #

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'Recently, a property on The Bishop's Avenue sold for £50 million.

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'No wonder it's known as billionaire's row.

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'Not as grand, and a couple of streets away from that opulence,

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'I've come to see a semi that went to auction.'

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The auction catalogue tells me the property is in Highgate! Wrong!

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The property is in East Finchley.

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Taking Bishop's Avenue out of the equation, properties are 15% to 20% cheaper compared to Highgate.

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This is why I stress the importance of visiting a property before going to auction.

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Buying blind is never OK,

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and you cannot always trust the information in the catalogue.

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So always go and see it yourself.

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So this is the property on this very noisy busy A road.

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But it is a semi-detached house, it's got three bedrooms and the guide price - £390,000!

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'That may be an awful lot of money to live next to an A road,

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'but this is the A1, meaning that although it's noisy,

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'it's a very well connected address.'

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Stinky...and damp are the words that spring to mind when you walk in.

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You can really smell the damp and you can see it everywhere.

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There's lumps of black splurged all over the ceiling.

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I know, from this catalogue, there has been a lot of water damage.

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This house is in need of some serious repair.

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We've got decaying floorboards and if you look closely on this,

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you can see the extent of the damp and the mould and the condensation

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that is everywhere over these walls.

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Right. Onwards.

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Ooh. And upwards!

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Water damage aside, let's take a look at what we've got.

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This would be the sitting room. Quite a nice '50s fireplace.

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Somebody's installed central heating.

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You've got secondary glazing,

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which you really need to keep that noisy road at bay.

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You've got storage, plenty to the front and the back.

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But I have to say, I'm still not massively excited about this place.

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# What do I gotta do to make you love me?

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# What do I gotta do to make you care...? #

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'Oh, dear. This house is in a pretty sorry state.

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'There are two old-fashioned scullery rooms,

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'and the second reception room looks like a sofa graveyard.'

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# ..It's sad, so sad So sad

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# It's a sad, sad situation And it's getting more and more... #

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'Upstairs, things are a little better.

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'Three good size bedrooms with lovely period features.

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'The secondary double glazing continues, giving some relief from that busy road.'

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When buying for investment purposes, always carry out thorough research.

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This will help you decide whether you want to sell on or rent out.

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Talking with local agents, I found out

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that adding an extra bedroom will broaden your sales market

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and increase its value by as much as £150,000 - loads of money!

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However, if you wanted to rent this out leaving it as a three-bed,

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it would be more advantageous because renters are less keen on four-bed houses.

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Research really is key to making any project a success.

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'It's a common mistake that investors make.

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'Always keep your end market in mind, from the moment you view a property.

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'Let's head to the back garden, to get a better idea of options.'

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When looking around a property, you know my mantra - can you add value?

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I found a way here, creating off-street parking.

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It is a must, and there's plenty of room to add a garage.

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Secure off-street parking will nearly always add value.

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It makes a property easier to market and, as it stands,

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the nearest place to park is a mile away - no good!

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'With this amount of space, there's no excuse for not having off-street parking.

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'It could take negotiation with the council,

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'but that would transform the appeal of the property instantly.'

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Ha! That garden is huge!

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120-foot, to be exact.

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It backs onto Highgate golf course so it's tranquil and beautiful.

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Parking opportunities? Yes, that would be nice.

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But I am seeing something that's much more interesting.

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A potential building plot.

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'There's road access to the garden, which makes it viable.

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'With developments in the area

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'planning permission shouldn't be difficult,

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'and that could turn this garden into a gold mine.

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'Maybe this place has more going for it than I initially thought.

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'Let's hear from a local estate agent.'

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Being on a main road will put some people off.

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Not everyone. Someone with a budget that wants to live in the area.

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I think we'd sell this no problem at all.

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'Bearing in mind the guide price of 390,000,

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'how much could this be worth once renovated?'

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If we just developed this as it is,

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we'd sell this on in the region of £600,000.

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'What about its value on the rental market?'

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If we were to rent this out as a three-bed, we'd achieve £1,500 per calendar month.

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'That's not all, by any means.

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'With a garden and plenty of scope to extend or split the property up,

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'the sky really could be the limit.'

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I think this is an exciting one to go for.

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Let's see who went for it at the auction.

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Three-bed semi. Back garden overlooks Highgate golf course.

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I haven't played there. Any members, please give us an invite.

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-Over to you...

-350!

-350 on my left.

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355. 360, sir?

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365? 370?

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375? 380?

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385?

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390?

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395? With you. 400?

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-405, sir?

-401.

-401.

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402? 403?

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404? 405?

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406? 407? 408?

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409? Have a think. 408 with you.

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409, new spot. 410?

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415? 420?

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425? 430?

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431? 432?

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433? 434?

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434?

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435? 436?

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437? 438?

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439?

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440. He's back in. 441?

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442? 443?

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444? 445?

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446?

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446 anywhere?

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446. 447?

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448?

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449?

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450? 451?

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452?

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453?

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454? 455?

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455?

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If not, 454 first time. Second time. Third...

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455. 456, sir?

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455, with you first time. Second time.

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Sold, 455.

0:22:320:22:35

'After an epic bidding battle,

0:22:350:22:37

'property developers Mohammed and Aniz stayed the course

0:22:370:22:42

'and bought the home for 455,000.

0:22:420:22:44

'I met up with them at their first joint venture to hear about their plans.'

0:22:440:22:50

Congratulations, guys. This is brilliant news.

0:22:500:22:55

-Thanks a lot.

-Mohammed, how did you find this property?

0:22:550:22:58

We went through the auction book, visited the properties from outside.

0:22:580:23:02

This was one that we really liked.

0:23:020:23:05

We checked the Land Registry for prices in this area.

0:23:050:23:11

If it goes for anything from 450 to 460, we'll go for it.

0:23:110:23:15

It was right in the middle, 455, and we, luckily, got it.

0:23:150:23:19

'At the auction, Mohammed and Aniz had no idea

0:23:190:23:23

'they were bidding against someone from the neighbouring property.'

0:23:230:23:27

The situation is, the planning department won't allow anything

0:23:310:23:36

which changes the character of these two houses.

0:23:360:23:40

So if it was one house, or we do anything together,

0:23:400:23:44

then it's easier, that's what they recommended to him.

0:23:440:23:48

That's why he was desperate to buy this property.

0:23:480:23:51

He suggested that we should do something together. We go to the council together.

0:23:510:23:57

Then it should be easy for both of us.

0:23:570:24:01

# We are neighbours... #

0:24:010:24:06

'Sounds like joining forces to strengthen their negotiating clout

0:24:060:24:11

'could be a very good way to approach the planners.'

0:24:110:24:15

Aniz, are you happy to work with your neighbour?

0:24:160:24:19

If he is cooperative with us, he is also going to gain from it.

0:24:190:24:23

Otherwise, in the short term, what we are going to do is rent it out.

0:24:230:24:29

That's the long-term plan. Let's see how it goes.

0:24:290:24:34

'They've got plans to demolish the houses and build luxury apartments

0:24:360:24:41

'or two townhouses.

0:24:410:24:43

'But in the short term, they're planning to let the property out

0:24:430:24:47

'while waiting for their planning applications to be approved.

0:24:470:24:53

'They've estimated it could take more than £10,000

0:24:530:24:57

'to sort the water damage and bring it up to a rentable standard.'

0:24:570:25:03

If we demolish this house, we're not going to spend this much money.

0:25:030:25:07

If we are going to extend and keep this, then we'll have to.

0:25:070:25:12

'It appears to be a long-term project

0:25:140:25:16

'and part of their plan is to deal with the parking problem.'

0:25:160:25:20

If we build the townhouses, we would ideally demolish this and go back.

0:25:200:25:25

This is too close to the road.

0:25:250:25:27

But the garden is huge and we have access from the back.

0:25:270:25:32

We can have parking at the back.

0:25:320:25:34

-I'm really excited to see how this is going to turn out. Good luck.

-Thanks very much.

0:25:340:25:39

Mohammed and Aniz have a lot of decisions to make -

0:25:390:25:43

renovate the property, extend the property or demolish the property?

0:25:430:25:48

Everything depends on negotiations with the owner of the neighbouring house.

0:25:480:25:54

It could be a very lucrative project for all involved.

0:25:540:25:58

You can find out how it all pans out later in the programme.

0:25:580:26:02

'Coming up, in Derby, is this flat all it's cracked up to be?'

0:26:030:26:08

Big question is, is it historic or is it still happening?

0:26:080:26:13

'We return to London, to this house with lots of land at the back,

0:26:130:26:18

'right on the main road.'

0:26:180:26:21

It's like a motorway.

0:26:210:26:24

'First, back to Cornwall, where duties have been evenly divided...'

0:26:240:26:28

I run all over the place. Valerie's role is making sandwiches.

0:26:280:26:33

'Time now, to return to Pool, near Redruth in Cornwall.

0:26:360:26:40

'This is where former milkman Gordon bought this end-of-terrace cottage

0:26:400:26:45

'right on the road for 56,000.

0:26:450:26:47

'The property had problems - wiring, damp and a backyard full of sheds.

0:26:470:26:53

'Gordon's partner Valerie revealed that he's a glutton for punishment.'

0:26:530:26:59

Sometimes I say, "Let's get one that you haven't got to do anything to."

0:26:590:27:04

That doesn't satisfy him. He likes ones that you've got to pull this down, look in there.

0:27:040:27:10

It's very satisfying to me.

0:27:100:27:12

'Well, five months on - and what a transformation!

0:27:130:27:18

'That drab exterior has been rerendered and painted white.

0:27:180:27:23

'The granite corner stones have been exposed,

0:27:230:27:26

'which has brought character to the building.

0:27:260:27:29

'Inside, the layout has changed completely.

0:27:290:27:33

'The dividing wall between the rooms has gone

0:27:330:27:36

'and the stairs have been relocated, creating a spacious living area.

0:27:360:27:42

'At one end, a superb kitchen has been installed.

0:27:430:27:49

'The damp's been treated, new windows have gone in

0:27:490:27:53

'and lovely slate sills added.

0:27:530:27:56

'Upstairs, a corridor has been added to the back wall.

0:27:580:28:01

'It's made the bedrooms a little smaller,

0:28:010:28:05

'but Gordon and his team have exposed some beautiful stone work.

0:28:050:28:11

'There was no need for that Jack and Jill bathroom in the end.

0:28:110:28:16

'By moving the staircase,

0:28:160:28:18

'Gordon's managed to squeeze in a new separate bathroom.'

0:28:180:28:25

When we bought the house, there wasn't a bathroom.

0:28:250:28:29

I had several ideas,

0:28:290:28:32

but I came up with this after talking to an architect friend.

0:28:320:28:37

It's a small room, but it's all you need.

0:28:370:28:40

'The property's been rewired,

0:28:400:28:42

'replumbed and central heating installed so it's like a new-build.

0:28:420:28:48

'The space in the cupboard with the flying freehold has been put to use.

0:28:480:28:54

'The extension that housed the kitchen is a utility room.

0:28:540:28:58

'Gordon's also sorted out that tiny kitchen.'

0:28:580:29:02

There wasn't much kitchen here. It was non-existent.

0:29:020:29:06

Just a sink out the back.

0:29:060:29:08

I'm very pleased. I never expected it to come out like this.

0:29:080:29:12

It's taken a lot of hard work and planning.

0:29:120:29:16

I'm really pleased.

0:29:160:29:18

'Quite right too! Valerie has been hands-on as well.'

0:29:180:29:23

I think she's got a lot of pleasure out of choosing the kitchen

0:29:230:29:27

and the tiles up there.

0:29:270:29:30

She's good at adding the touches to it.

0:29:300:29:33

# Why don't you come over, Valerie? #

0:29:330:29:38

'It wasn't all Valerie, though.

0:29:380:29:40

'Gordon was kept busy throughout.'

0:29:400:29:43

Gordon was the site foreman.

0:29:430:29:45

He went round picking up all the stuff.

0:29:450:29:48

It was hectic, some days, going backwards and forwards.

0:29:480:29:53

Whatever they wanted, get it here.

0:29:530:29:55

If they were short of cement or timber, whatever, nails, screws.

0:29:550:30:01

I've run all over the place. Valerie's role is making sandwiches.

0:30:010:30:07

'After all, keeping the builders well fed IS half the battle.

0:30:070:30:11

'The two sheds in the yard have been demolished

0:30:110:30:15

'and new paving's been laid so it's more inviting out there.

0:30:150:30:21

'Gordon even kept the outside loo for emergencies.

0:30:210:30:23

'How long did it take to get everything done?'

0:30:230:30:28

20 weeks, which is longer than I anticipated,

0:30:280:30:31

because of all the extra problems.

0:30:310:30:35

That end of the building, we had to underpin,

0:30:350:30:38

because there wasn't a lot of foundation to that side of it.

0:30:380:30:42

That added to the challenge!

0:30:420:30:45

'Did it add to the cost?

0:30:450:30:47

'You may remember Gordon had a healthy budget of 30,000 to 35,000.'

0:30:470:30:54

We've gone over the budget. It's more like 65,000.

0:30:540:30:57

That is just what I've spent on refurbishing the place.

0:30:570:31:01

We've also got legal costs and the purchase price.

0:31:010:31:04

'That spend of 65,000 represents £30,000 over his upper limit.

0:31:040:31:11

'Quite an overspend, but he really has made a lovely job of this.

0:31:110:31:17

'Time for two local property experts to give their impressions

0:31:170:31:22

'of Gordon's latest project.'

0:31:220:31:24

They've done such an amazing transformation.

0:31:240:31:28

You take a step back and it really is an eye-opener.

0:31:280:31:33

The layout's really, really good. Limited space on offer.

0:31:330:31:38

A nice lounge-kitchen downstairs, bathroom upstairs,

0:31:380:31:43

which is definitely a benefit.

0:31:430:31:45

Everything they've done is to a high standard.

0:31:450:31:49

It certainly would derive the most value possible.

0:31:490:31:53

I wouldn't have done anything differently.

0:31:530:31:55

I think the standard's very, very good.

0:31:550:31:58

Any potential purchaser or tenant is going to be very pleased.

0:31:580:32:03

'Has all the hard work produced any profit?

0:32:030:32:06

'Gordon paid £56,000 for the property

0:32:060:32:08

'and reckons that his budget before costs is 65,000,

0:32:080:32:13

'making a total of £121,000.

0:32:130:32:17

'What could the place be worth?'

0:32:170:32:19

I would recommend an asking price in the region of £125,000.

0:32:220:32:26

I would place this property on the market in the region of £130,000,

0:32:260:32:30

but likely to achieve under the Stamp Duty level of £125,000.

0:32:300:32:35

'If the house did sell for 125,000,

0:32:350:32:40

'Gordon's profit would be just £4,000, and there are costs to come out of that as well.'

0:32:400:32:47

That would be somewhere near. Yeah, we would be OK with that.

0:32:470:32:51

It's not the best time to be selling, though.

0:32:510:32:55

I might go down the rental road to start with.

0:32:550:32:58

Then see how it goes in the future.

0:32:580:33:00

'Yes, that might be the best option. How much rent could the house earn?'

0:33:000:33:06

For rental, I would expect to achieve in the region of £550 per calendar month.

0:33:060:33:13

On the rental market, I'd expect to achieve in the region of £550 per calendar month.

0:33:130:33:19

I would have thought 575...

0:33:190:33:21

550, 575.

0:33:210:33:24

Um... We'll have to test that.

0:33:240:33:27

'Well, it's good news, as Gordon HAS managed to rent out the property

0:33:270:33:32

'for more than the agents estimated.

0:33:320:33:35

'He's getting £625 a month, so that's great.

0:33:350:33:39

'Is he pleased he took a chance and bought this cottage?'

0:33:390:33:43

Yes. I am.

0:33:430:33:46

I'm pleased with the outcome.

0:33:460:33:49

It's had its problems, but we've overcome the problems.

0:33:490:33:54

I mean, it's quite a tidy property.

0:33:540:33:57

'I'm in Derby in the east Midlands.

0:34:030:34:06

'This city's played a central role

0:34:060:34:08

'in the manufacturing history of Britain,

0:34:080:34:13

'from the Industrial Revolution to modern car manufacture.'

0:34:130:34:17

I'm in the Five Lamps area of Derby, close to the city centre,

0:34:170:34:22

popular with students, so good from an investment point of view.

0:34:220:34:26

The property I'm here to see could tick the boxes.

0:34:260:34:30

It's a one-bedroom flat in this uninspiring looking block. Let's look inside.

0:34:300:34:36

'This second-floor flat is one of a block of nine and had a guide price of £45,000.'

0:34:360:34:43

So what have we got? Small entrance area there.

0:34:430:34:47

Bathroom and loo to your left. They're in a right old state.

0:34:470:34:53

Worse than that, no natural light or ventilation.

0:34:530:34:57

You want to find a solution, if you could. Through to the kitchen.

0:34:570:35:02

Again, very small, and the units?

0:35:020:35:05

I doubt they've been replaced since the place was built.

0:35:050:35:09

Here's another throwback to that era - a serving hatch.

0:35:090:35:13

Perfect if you're serving roasted elephant. Absolutely massive.

0:35:130:35:18

The good news, though, is that this is a stud partition wall.

0:35:180:35:23

It wouldn't be too much effort to take that out, create an open-plan living room/kitchen.

0:35:230:35:29

That's what you need to do to give the flat more space!

0:35:290:35:34

# It was acceptable in the '80s... #

0:35:340:35:40

'Removing the partition wall and updating the kitchen

0:35:400:35:44

'could make this room the biggest selling point.'

0:35:440:35:48

Well, here in the bedroom, and that's not good news.

0:35:500:35:55

Cracks in the wall are never good.

0:35:550:35:58

Diagonal cracks, they're even worse.

0:35:580:36:00

Cracks that get gradually wider, they're worse still.

0:36:000:36:06

What am I thinking? Unusual to find that in a block of flats.

0:36:060:36:10

It looks like there has been some settlement.

0:36:100:36:13

The big question is, is it historic or is it still happening?

0:36:130:36:19

Somebody's stuck these bits of tape,

0:36:190:36:21

a make-shift way to find out whether or not the cracks are moving.

0:36:210:36:26

They've been there for a long time. They haven't fallen off.

0:36:260:36:30

To my mind, that is historic.

0:36:300:36:33

So there could be good news, but it needs to be checked out.

0:36:330:36:38

'Outside, there's definitely some good news.'

0:36:380:36:42

A real bonus, because at the rear there is a set of garages.

0:36:440:36:48

As an owner of the flat, you own one of these garages.

0:36:480:36:52

In a city centre like this, parking is at a premium.

0:36:520:36:57

If you haven't got a car or you fancy increasing your income,

0:36:570:37:01

what about renting one out?

0:37:010:37:03

Around here, £20, £25 a week? That adds a lot to your bottom line.

0:37:030:37:07

'So, with the modest guide price of 45,000, was this a good investment?

0:37:070:37:13

'Let's find out from the man who sold it at auction.'

0:37:130:37:17

If it was me,

0:37:190:37:21

I'd make sure that the wall between the living room and kitchen came out

0:37:210:37:26

for an open-plan living/kitchen, and the bathroom needs refitting.

0:37:260:37:31

It's just routine stuff.

0:37:310:37:33

'What rental value could it bring in once brought up to modern standard?'

0:37:330:37:38

My estimate of rental value would be between £475 and £500 a calendar month.

0:37:400:37:46

'What could the flat be worth if the new owner did it up to sell on?'

0:37:460:37:51

It's going to be linked to its investment value,

0:37:510:37:55

certain to be sold to the investment market at a value of about £65,000.

0:37:550:37:59

It may not be the most inspiring of flats

0:37:590:38:03

and that crack needs investigation, although I think it's probably not an issue.

0:38:030:38:08

Spend a little bit of money on it. It's in a great location. A good return on your investment, I think.

0:38:080:38:15

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

0:38:150:38:20

It's an upper floor one-bedroom flat, good location.

0:38:200:38:24

Who's got 40 to start me? 40,000 is bid.

0:38:240:38:28

At £40,000 bid. It's a cheap flat.

0:38:280:38:31

41 somewhere else? 41 is bid here.

0:38:310:38:34

Thank you. At 41.

0:38:340:38:36

42 I have. £42,000. 43 for you?

0:38:360:38:40

43 is bid. At 43. 44? 44,000.

0:38:400:38:45

At £44,000...

0:38:450:38:47

45,000, just in time. A fresh bidder. 46? 46? 45 seated.

0:38:470:38:52

46, against you? At £45,000. All finished and done?

0:38:520:38:57

Once. Going twice.

0:38:570:39:00

Third chance?

0:39:000:39:03

Sold at 45,000.

0:39:030:39:04

'Talk about fast work! the new owner of the flat is Carro, on the right,

0:39:040:39:09

'who works in education.

0:39:090:39:11

'She got the flat on her first bid.'

0:39:110:39:14

# It's so easy... #

0:39:140:39:16

'I met her and her daughter Jessica to hear about their plans.'

0:39:160:39:21

Jessica, Carro, lovely to meet you both.

0:39:210:39:24

-Hi.

-Tell me why you wanted to buy the flat.

-It was a whim.

0:39:240:39:30

-A whim?

-A whim.

-What do you mean?

0:39:300:39:33

I always thought that buying at auction would be fun, so I found myself at an auction with a friend.

0:39:330:39:39

I bid for it and it was my one and only ever auction bid.

0:39:390:39:43

-You arrive at the auction...?

-Yeah.

-Just for a day out with your mate?

0:39:430:39:48

I was going with a friend who was selling a property, as moral support.

0:39:480:39:53

I always thought it would be interesting to buy.

0:39:530:39:57

I had seen this and thought, "That's a good price" but hadn't gone much further.

0:39:570:40:03

-So you were of a mind to buy.

-It had flittered across my bird brain!

0:40:030:40:09

'Bidding on a whim may seem reckless,

0:40:090:40:12

'but Carro did have the required funds in place,

0:40:120:40:16

'essential when buying at auction.

0:40:160:40:19

'She's bought and renovated properties in the past,

0:40:210:40:25

'so she's not totally unprepared.'

0:40:250:40:27

-What is the plan for it, then?

-New kitchen.

-Open it up.

0:40:270:40:32

-Put a breakfast bar in.

-New bathroom.

0:40:320:40:36

-What budget?

-If it came in at under eight, I'd be pleased.

0:40:360:40:39

-If it's more than ten, I shall be looking over the top of my glasses.

-And what about timescale?

0:40:390:40:47

-Two weeks.

-What?

0:40:470:40:49

I think we can do it in two weeks.

0:40:490:40:52

Run me through the list to do.

0:40:520:40:55

-New bathroom, new kitchen, decorate throughout.

-New floor.

0:40:550:40:59

-New storage heaters.

-Probably a rewire.

0:40:590:41:02

I don't like the fact that there's no natural light in the bathroom.

0:41:020:41:07

-Who's doing the work?

-A builder.

0:41:070:41:10

-Have you told him the timescale?

-Yes.

-And he said?

0:41:100:41:13

-"I'll give you your money back if I don't do it in time."

-No!

-It was worth a try!

0:41:130:41:18

We have worked with him for a long time so speak each other's language.

0:41:180:41:24

'Two weeks to replace a kitchen, a bathroom, remove a wall and put a window into the communal area?

0:41:260:41:34

'This project requires a veritable superman, or woman.

0:41:340:41:38

'Let's meet Andy, the superhero builder!'

0:41:380:41:43

-What do you think about the flat?

-Yeah. It's not a bad flat.

0:41:430:41:46

Take a bit of doing up. We're on the fortnight, apparently.

0:41:460:41:51

-You've heard about that?

-Yeah.

0:41:510:41:53

What did you say when you heard that timescale?

0:41:530:41:57

I smiled at her, like I usually do.

0:41:570:41:59

But realistically...

0:41:590:42:01

I think the kitchen and bathroom we can get in in a fortnight.

0:42:010:42:06

Then there's the wiring and the heaters, so that might take longer.

0:42:060:42:11

A month's more realistic, but don't tell her I said that.

0:42:110:42:15

She'll never forgive me.

0:42:150:42:18

'With all his years of experience, what does Andy think

0:42:180:42:22

'about the crack in the wall?'

0:42:220:42:24

A few years after it was built, the building went...

0:42:240:42:30

I don't think it'll go further. I think it's settled.

0:42:300:42:34

# A hero! I'm holding out for a hero... #

0:42:340:42:38

'It's going to take a heroic effort

0:42:380:42:41

'if Andy is to turn this job around in two weeks.

0:42:410:42:44

'Perhaps Carro will think twice before she bids on a whim.'

0:42:440:42:48

I don't think I could go to auction again. That might raise domestic issues.

0:42:480:42:56

-Your partner, was he vaguely clued-up...?

-I rang him up.

0:42:560:43:01

I said, "I bought it."

0:43:010:43:03

He said, "That's lovely, darling. What have you bought?"

0:43:030:43:08

-I said, "A flat." And there was a very long pause.

-And after?

0:43:080:43:13

He'll be here with the paint and a roller.

0:43:130:43:15

-I wish you all the best. Good luck. You'll need it.

-Thank you.

0:43:150:43:20

Thank you. LAUGHTER

0:43:200:43:22

-CHUCKLES

-What a funny story.

0:43:220:43:25

Carro's got some challenges ahead sorting this place out.

0:43:250:43:29

It wouldn't be so bad if she hadn't set this two-week timescale!

0:43:290:43:34

Even with the help of daughter Jessica and builder Andy,

0:43:340:43:39

I think she's got a challenge ahead. Find out later in the show.

0:43:390:43:44

Doing up a property takes longer than you imagine.

0:43:470:43:50

There are all sorts of reasons why delays happen.

0:43:500:43:53

-Have our buyers raced ahead or have they been held up?

-Let's find out.

0:43:530:43:59

'We're back to the busy streets of London

0:43:590:44:02

'to catch up with developers Aniz and Mohammed.

0:44:020:44:06

'They paid £455,000 for this water damaged and unloved house

0:44:060:44:10

'on the very busy A1 in East Finchley.

0:44:100:44:16

'They had a few options, but ideally wanted to demolish the whole place

0:44:160:44:20

'and build luxury flats.'

0:44:200:44:22

# Knock it down! Knock it down! Knock it down! Yeah! #

0:44:220:44:26

'They'd even joined forces with their neighbour

0:44:260:44:29

'to help them get planning permission.'

0:44:290:44:33

They won't allow anything which changes the character of these two houses.

0:44:330:44:39

So if it was one house or if we do anything together, it's much easier.

0:44:390:44:45

He suggested, which is a good idea, that we go to the council together.

0:44:450:44:50

What he extends, we should do the same and it should be easier for both of us.

0:44:500:44:56

'The main asset was the 120-foot garden

0:45:020:45:05

'which overlooked the golf course.

0:45:050:45:07

'But the house had no parking,

0:45:070:45:09

'giving them something else to sort, along with the planning permission.

0:45:090:45:14

'It's now seven months since we saw the place,

0:45:140:45:18

'which was in a pretty sorry state.

0:45:180:45:19

'How are they getting on?

0:45:190:45:22

'The house is still standing, and has been renovated and rented out

0:45:250:45:30

'while they wait for planning permission.

0:45:300:45:33

'Despite Mohammed's grand plans,

0:45:330:45:36

'he and Aniz have major obstacles to overcome

0:45:360:45:40

'before they and their neighbour can demolish and rebuild.

0:45:400:45:44

'It turns out that the access to the rear is owned by the local water board.

0:45:480:45:55

'Any plans for off-street parking will need to be negotiated with them separately.'

0:45:550:46:02

There's no parking. Too close to the street.

0:46:020:46:05

When they built these houses there was hardly any traffic.

0:46:050:46:09

Now, there's so much traffic. It's like a motorway.

0:46:090:46:13

'The parking is a priority but that's not Mohammed's only concern.

0:46:130:46:19

'It's a conservation area and there's local opposition

0:46:190:46:24

'from people who don't want to see the character buildings disappear.

0:46:240:46:30

'While negotiations continue,

0:46:300:46:32

'at least this semi has been refurbished and is being lived in.'

0:46:320:46:37

I had in mind that we'll change the bathroom, the kitchen.

0:46:370:46:41

But if we demolish the building, there's no point spending money.

0:46:410:46:45

I mean, to do this work has cost me £8,500.

0:46:450:46:49

The tenants are hardly paying me anything. They're looking after the place.

0:46:490:46:55

Our main concern is that somebody's living here

0:46:550:46:59

until we get the planning permission.

0:46:590:47:02

'Mohammed's convinced that, despite the problems,

0:47:020:47:05

'his plans will go ahead

0:47:050:47:06

'and soon he'll be building the development of his dreams.'

0:47:060:47:10

# Dream on, dreamer Life gets in your way... #

0:47:100:47:15

My main idea is that I have a nice apartment in this building,

0:47:150:47:19

with a view to the golf course.

0:47:190:47:21

That's my aim, and my dream as well.

0:47:210:47:24

'Of course, like any developer worth their salt,

0:47:240:47:27

'Mohammed has a Plan B.'

0:47:270:47:30

If we don't get the planning permission to have the apartments, we can have two townhouses.

0:47:300:47:37

The first option is the apartments. If not, the townhouses.

0:47:370:47:42

'This is a work in progress, but have they added value so far?

0:47:440:47:49

'Will all the negotiations be worth it?

0:47:490:47:52

'Let's ask a couple of local estate agents for their opinion, first about the house itself.'

0:47:520:47:58

A nice house, good three bedrooms up top.

0:47:580:48:03

The kitchen needs a good old once over. Nice it leads into the garden.

0:48:030:48:08

It's your main selling feature, the size and the golf course.

0:48:080:48:14

Parking is crucial. Without any sort of parking whatsoever,

0:48:140:48:19

it massively affects the value and the saleability.

0:48:190:48:23

Not a lot of people want to spend a decent amount on a property without parking.

0:48:230:48:29

'Mohammed and Aniz have, so far, spent a total of just over 460,000,

0:48:290:48:36

'including the 455 grand purchase price, albeit on a basic renovation.

0:48:360:48:40

'What could it make on the resale market?'

0:48:400:48:45

If you refurbished it, made it very nice,

0:48:450:48:48

I'd say probably about £550,000.

0:48:480:48:52

Fully modernised, you're probably looking from £525,000 to about £550,000.

0:48:520:49:00

'If a little more was spent renovating the property

0:49:000:49:03

'and sorting out that parking, there could be a decent profit here.

0:49:030:49:07

'But of course, Mohammed's master plan is to build ten flats here.

0:49:070:49:12

'How much would each of those be worth, once completed?'

0:49:120:49:16

Flats would work very well here.

0:49:160:49:19

Again, the parking is key.

0:49:190:49:21

The higher they get, the views will be fantastic.

0:49:210:49:24

You'd get incredible views over the golf course.

0:49:240:49:27

Flats vary hugely on specification.

0:49:270:49:31

The block next door, they go for 300,000.

0:49:310:49:34

A block down the road, £600,000, up to a penthouse for two million.

0:49:340:49:39

It has to be very high-spec, decent size and make the most of the views.

0:49:390:49:44

'This is speculative, as there are many hoops to jump through first.

0:49:440:49:48

'If it all goes to plan, Mohammed and Aniz won't just build the flats,

0:49:480:49:53

'they'll move in themselves.'

0:49:530:49:57

We can't wait to put the application in and see some work happening.

0:49:570:50:01

I said before that we would like to keep one apartment each for our use

0:50:010:50:07

because I love this area.

0:50:070:50:09

'Back to Derby, the Five Lamps district,

0:50:130:50:17

'where a flat in this block, plus its garage, went to auction.

0:50:170:50:22

'Carro paid 45,000 for it - amazingly an impulse buy.

0:50:220:50:26

'With daughter Jessica, they were going to undertake renovation work -

0:50:260:50:32

'new kitchen, new bathroom, new everything on a timescale of just two weeks!'

0:50:320:50:38

-Who's doing the work?

-A builder.

-Have you told him the timescale?

0:50:380:50:42

-Yes.

-And he said?

-"I'll give you your money back if we don't do it."

0:50:420:50:46

-He did not.

-It was worth a try!

0:50:460:50:49

'Carro WAS joking about getting her money back,

0:50:490:50:54

'but she did have faith that her regular superman builder, Andy,

0:50:540:51:00

was the man for the job.

0:51:000:51:02

'Eight weeks have passed and we've met up with Carro and Jessica

0:51:040:51:08

'to see if that heat-of-the-moment buy burned a hole in their pocket.

0:51:080:51:12

'The old living room has gone, replaced by a brighter space.

0:51:140:51:19

'And the kitchen?'

0:51:190:51:21

When we bought the place, it was one kitchen and a lounge.

0:51:250:51:28

A huge massive hatch here.

0:51:280:51:31

We decided to knock it down, initially to here.

0:51:310:51:35

But when you opened the door, it just didn't work.

0:51:350:51:39

We had the builder knock it further back.

0:51:390:51:42

A brand new fitted kitchen. Space to sit, a breakfast bar.

0:51:420:51:47

The cooker is hidden so if you're watching TV in the lounge

0:51:470:51:50

you're not aware of the mess you've left behind.

0:51:500:51:55

So we're really pleased with it. It's what we wanted.

0:51:550:51:59

'The alterations are perfect for Carro and Jessica's plan

0:51:590:52:03

'to rent the property out.

0:52:030:52:06

'The bathroom has had a total makeover,

0:52:060:52:09

'with a new suite, tiles and flooring.

0:52:090:52:13

'The bathroom and kitchen aren't all that's new.'

0:52:130:52:16

The majority of what we've done is cosmetic.

0:52:160:52:20

We put the floors down, really neutral decor.

0:52:200:52:24

Blinds for a very low-key finish.

0:52:240:52:26

There were some big cracks in that wall that were worrying.

0:52:260:52:30

It was historic movement so no problem.

0:52:300:52:34

We went for a really slimline heater

0:52:340:52:37

to maximise space where anyone would want to put their furniture.

0:52:370:52:41

The best bit about this room is that over here

0:52:410:52:45

we've managed to get a shower cubicle in.

0:52:450:52:49

What we'd got in the bathroom was the tanks taking up space.

0:52:490:52:53

We plastered the wall on that side and opened it up on this side.

0:52:530:52:58

'A shower in the bedroom might not suit everybody.

0:52:580:53:03

'If a couple end up here, it might help stop morning arguments

0:53:030:53:08

'about whose turn it is in the bathroom.

0:53:080:53:11

'The changes have definitely given the flat a bright new start.'

0:53:110:53:17

The biggest job was making it liveable.

0:53:170:53:21

It looked a lot worse than when we first got it.

0:53:210:53:24

There was a lot of mess because we decided on a rewire,

0:53:240:53:29

to put the tanks in the loft and to take a wall down.

0:53:290:53:33

-It looked a whole lot worse.

-The flat's really changed.

0:53:330:53:39

It's brighter. It's liveable and it wasn't before.

0:53:390:53:42

'Even though they could have gone overboard on the finish,

0:53:440:53:48

'they stuck with a basic good quality renovation aimed at the rental market.

0:53:480:53:55

'Carro was looking for a return as soon as possible.'

0:53:550:53:58

I thought we could turn it round between two and three weeks.

0:53:580:54:03

I'm very pleased to say that what I paid for was 17 days of labour,

0:54:030:54:08

so I think I'm in my time frame.

0:54:080:54:11

# I'm holding out for a hero... #

0:54:110:54:14

'So, Andy the builder has managed to do a heroic job

0:54:140:54:19

'of renovating the whole flat, including sorting out the hot and cold tanks and the rewiring.

0:54:190:54:25

'Was he equally heroic when it came to the budget?'

0:54:250:54:30

My budget was between eight and ten.

0:54:300:54:33

I was nurturing a secret hope that it might come in as less.

0:54:330:54:37

I've spent 9,000 so I'm pleased.

0:54:370:54:39

I've sold the garage for 5,000, which I didn't particularly want.

0:54:390:54:44

If you offset them, I've only spent four!

0:54:440:54:48

'That garage could have been a handy asset,

0:54:480:54:51

'but with the town centre five minutes' walk away,

0:54:510:54:56

'Carro felt it didn't add to the investment, and cashed in on it.

0:54:560:55:00

'That spend of £4,000 added to her purchase price of 45,000

0:55:000:55:04

'takes her total to around £49,000.

0:55:040:55:08

'Bearing in mind Carro bought this flat on a whim

0:55:080:55:12

'with her first and only auction bid, that was a risk.

0:55:120:55:15

'So, with £49,000 outlay to recoup,

0:55:170:55:21

'let's hear what two local estate agents think about Carro's work.'

0:55:210:55:26

The refurbishment of the kitchen is excellent. The bathroom's very good.

0:55:260:55:32

This has been brought to quite a nice standard for rental.

0:55:320:55:37

Opening up the kitchen to the lounge gives an extra sense of space.

0:55:370:55:42

Putting a shower in the bedroom is a little bit unusual.

0:55:420:55:47

But it's not going to stop somebody renting it or buying it.

0:55:470:55:51

'Carro's opted to rent the property out.

0:55:510:55:54

'What return might she expect on her £49,000 investment?'

0:55:540:56:00

It's likely to rent for £395 per calendar month.

0:56:000:56:03

If I was marketing this property, I'd put it on for £425 per calendar month.

0:56:030:56:08

I think it will get 425. I wouldn't be disappointed with 400.

0:56:080:56:13

'That figure of £425

0:56:130:56:16

'would give Carro an annual yield of just over 10%,

0:56:160:56:21

'a very impressive rate of return, and the estate agents reckon

0:56:210:56:25

'a resale could achieve a possible £55,000.

0:56:250:56:28

'That would leave her a pre-tax profit of only around six grand.

0:56:280:56:35

'Has that possible rental income proved to be the icing on the cake?'

0:56:350:56:41

Although I was terrified and horrified when the hammer went down,

0:56:410:56:46

"Ah! What have I done?" I'm really glad I did it.

0:56:460:56:51

We'll have more thrills from the auctions next time.

0:56:540:56:58

-Make sure you keep watching Homes Under The Hammer.

-Goodbye.

0:56:580:57:02

Subtitles by Red Bee Media Ltd

0:57:190:57:23

E-mail [email protected]

0:57:230:57:26

Martin Roberts and Lucy Alexander visit an old cottage in Cornwall, a house in London and a one-bed flat in Derby. 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.